Investment Thesis
OriginClear faces critical financial distress with negative stockholders' equity of -$32.2M indicating technical insolvency. The company burns $2.3M annually on stagnant $4.1M revenue, leaving approximately 4 months of cash runway, making restructuring or bankruptcy highly probable absent immediate major capital infusion.
Strengths
- Still generating operating revenue of $4.1M despite severe distress
- Operates in specialized water treatment machinery sector with potential industry tailwinds
- Maintains $756.7K in cash for immediate near-term obligations
Risks
- Negative stockholders' equity of -$32.2M represents technical insolvency with liabilities exceeding assets by $32.2M
- Operating cash burn of $2.3M annually against only $4.1M revenue with critically low 0.09x current ratio and ~4 months cash runway
- Broken business model with -73.4% operating margin, -775.1% net margin, and zero revenue growth indicating no viable profitability path
Key Metrics to Watch
- Monthly operating cash burn rate and remaining cash runway duration
- Revenue growth acceleration and new contract pipeline development
- Stockholders' equity stabilization and any capital raises or debt restructuring
- Gross margin expansion and operating expense reduction initiatives
Financial Metrics
Revenue
4.1M
Net Income
-31.4M
EPS (Diluted)
$0.00
Free Cash Flow
-2.3M
Total Assets
2.7M
Cash
756.7K
Profitability Ratios
Gross Margin
8.1%
Operating Margin
-73.4%
Net Margin
-775.1%
ROE
N/A
ROA
-1,144.8%
FCF Margin
-57.7%
Balance Sheet & Liquidity
Current Ratio
0.09x
Quick Ratio
0.09x
Debt/Equity
N/A
Debt/Assets
1,002.4%
Interest Coverage
-2.25x
Long-term Debt
2.0M
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: 2026-04-13T12:33:29.302797 |
Data as of: 2025-09-30 |
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