Investment Thesis
Pacific Sports Exchange exhibits severe fundamental deterioration characterized by technical insolvency with negative stockholders' equity of -$52.2K, collapsing revenue down 14.8% YoY to just $2.2K, and persistent operating losses of -$10.1K. The company has zero cash, negative operating cash flow, and critical liquidity ratios (current ratio 0.11x) that indicate immediate solvency risk without capital restructuring or operational transformation.
Strengths
- Gross margin of 9.1% indicates some pricing power despite minimal revenue base
- Small balance sheet ($6.8K assets) limits absolute downside exposure
- Company maintains minimal non-zero asset base for potential liquidation recovery
Risks
- Negative stockholders' equity of -$52.2K represents technical insolvency and balance sheet insolvency
- Revenue collapsed 14.8% YoY to only $2.2K indicating business model failure
- Operating cash flow of -$1.5K with zero cash equivalents creates immediate liquidity crisis with no runway
- Operating margin of -458.2% and ROA of -148.9% demonstrate fundamentally unprofitable and value-destructive unit economics
- Critical liquidity ratios (current 0.11x, quick 0.00x) indicate severe working capital deficiency and inability to meet obligations
- Bankruptcy or forced liquidation risk imminent without significant capital injection or debt restructuring
Key Metrics to Watch
- Quarterly revenue trend and stabilization point
- Operating cash flow and monthly cash burn rate
- Stockholders' equity progression and solvency status
- Debt restructuring or capital raise announcements
- Changes in operating losses and path to breakeven
Financial Metrics
Revenue
2.2K
Net Income
-10.1K
EPS (Diluted)
$0.00
Free Cash Flow
-1.5K
Total Assets
6.8K
Cash
0.0
Profitability Ratios
Gross Margin
9.1%
Operating Margin
-458.2%
Net Margin
-458.2%
ROE
N/A
ROA
-148.9%
FCF Margin
-67.1%
Balance Sheet & Liquidity
Current Ratio
0.11x
Quick Ratio
0.00x
Debt/Equity
N/A
Debt/Assets
0.0%
Interest Coverage
N/A
Long-term Debt
N/A
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: 2026-04-14T17:15:25.167714 |
Data as of: 2025-11-30 |
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