Investment Thesis
Maison Solutions is a severely distressed retail grocer facing acute financial deterioration with negative operating margins (-4.7%), significant net losses (-$11.7M), and critically weak liquidity (0.67x current ratio). The company is burning shareholder capital despite positive operating cash flow, evidenced by negative ROE of -152.2% and ROA of -16.3%, indicating fundamental business model challenges in a highly competitive grocery sector.
Strengths
- Positive operating cash flow of $911.8K despite net operating losses suggests some underlying operational liquidity
- Gross margin of 24.4% indicates reasonable cost management at the product level before operating expenses
- Free cash flow positive at $862.4K shows the company is not immediately consuming cash for operations
Risks
- Severe profitability crisis with net margin of -13.9% and operating margin of -4.7%, losing money on every dollar of sales
- Critical liquidity crisis with current ratio of 0.67x and quick ratio of 0.37x, indicating inability to cover short-term obligations
- Negative shareholder returns with ROE of -152.2% and ROA of -16.3%, destroying equity value; minimal cash reserves of $1.5M relative to $64.5M liabilities creates solvency risk
Key Metrics to Watch
- Operating margin trend and path to profitability within 2-3 quarters
- Working capital management and current ratio improvement toward 1.0x+ threshold
- Debt reduction milestones and interest coverage recovery from critically negative -100.5x
Financial Metrics
Revenue
84.3M
Net Income
-11.7M
EPS (Diluted)
$-0.53
Free Cash Flow
862.4K
Total Assets
72.1M
Cash
1.5M
Profitability Ratios
Gross Margin
24.4%
Operating Margin
-4.7%
Net Margin
-13.9%
ROE
-152.2%
ROA
-16.3%
FCF Margin
1.0%
Balance Sheet & Liquidity
Current Ratio
0.67x
Quick Ratio
0.37x
Debt/Equity
0.33x
Debt/Assets
89.5%
Interest Coverage
-100.53x
Long-term Debt
2.6M
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: 2026-04-02T08:36:12.951839 |
Data as of: 2026-01-31 |
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