Investment Thesis
Limoneira is in severe financial distress with persistent operating losses (-58% margin), negative free cash flow (-15.4M), and a critically depleted cash position (1.3M) insufficient to support ongoing operations. The company cannot service its 89.9M debt burden from operations (negative interest coverage), creating imminent refinancing risk.
Strengths
- Substantial asset base of 307.5M provides liquidation value
- Positive stockholders equity of 169.8M
- Modest revenue growth of 3.9% YoY indicates some market demand
Risks
- Liquidity crisis: only 1.3M cash against 3.7M annual capex and debt obligations
- Negative operating cash flow (-11.7M) signals fundamental operational deterioration
- Debt-to-equity of 0.53x is manageable numerically but dangerous given negative EBIT and inability to cover interest
- Free cash flow margin of -84.7% indicates unsustainable cash burn
- Negative interest coverage ratio (-7.0x) suggests covenant violation risk
Key Metrics to Watch
- Operating cash flow trajectory (must reach positive territory)
- Gross margin and product-level profitability (currently unavailable)
- Cash position and liquidity events (refinancing timelines)
- Debt covenant compliance and potential restructuring announcements
Financial Metrics
Revenue
18.2M
Net Income
-9.4M
EPS (Diluted)
$-0.53
Free Cash Flow
-15.4M
Total Assets
307.5M
Cash
1.3M
Profitability Ratios
Gross Margin
N/A
Operating Margin
-58.0%
Net Margin
-51.8%
ROE
-5.6%
ROA
-3.1%
FCF Margin
-84.7%
Balance Sheet & Liquidity
Current Ratio
1.16x
Quick Ratio
1.16x
Debt/Equity
0.53x
Debt/Assets
41.3%
Interest Coverage
-7.03x
Long-term Debt
89.9M
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-04-12T17:00:20.346645 |
Data as of: 2026-01-31 |
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