Investment Thesis
MGT Capital Investments exhibits severe financial distress with negative stockholders' equity of -$2.3M, indicating the company is technically insolvent. The company is burning cash at an alarming rate with negative operating cash flow of -$991K and negative free cash flow of -$2.3M, while revenue has collapsed 73% year-over-year. With minimal revenue of $87K, a current ratio of 0.09x, and liabilities nearly 23x larger than assets, the company faces imminent liquidity crisis.
Strengths
- Positive gross profit of $1.6M (though metric is unreliable given revenue decline)
- Some cash reserves remaining at $103K
- Company still reports activity and financial reporting
Risks
- Negative stockholders' equity indicates technical insolvency and potential bankruptcy risk
- Severe liquidity crisis with current ratio of 0.09x (needs 1.0x minimum for operational viability)
- Catastrophic revenue decline of 73% YoY with revenue base of only $87K
- Massive cash burn with negative FCF of -$2.3M while holding only $103K in cash
- Total liabilities of $2.4M dwarf total assets of $106K creating unsustainable debt burden
- Negative operating cash flow of -$991K indicates core business cannot generate cash
- Zero insider activity suggests possible management disengagement
- Negative ROA of -206.6% shows catastrophic asset utilization
Key Metrics to Watch
- Stockholders equity recovery from -$2.3M (insolvency threshold)
- Monthly cash burn rate relative to remaining $103K reserve
- Revenue stabilization and path to profitability
- Debt restructuring or refinancing announcements
- Quarterly cash flow improvement to positive territory
Financial Metrics
Revenue
87.0K
Net Income
-219.0K
EPS (Diluted)
$0.00
Free Cash Flow
-2.3M
Total Assets
106.0K
Cash
103.0K
Profitability Ratios
Gross Margin
1,875.9%
Operating Margin
-916.1%
Net Margin
-251.7%
ROE
N/A
ROA
-206.6%
FCF Margin
-2,690.8%
Balance Sheet & Liquidity
Current Ratio
0.09x
Quick Ratio
0.09x
Debt/Equity
N/A
Debt/Assets
2,251.9%
Interest Coverage
-8.76x
Long-term Debt
111.0K
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: 2026-04-01T22:20:12.124584 |
Data as of: 2025-12-31 |
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