Investment Thesis
Mammoth Energy exhibits severe operational deterioration with negative operating income (-3.9% margin), negative operating cash flow (-$3.0M), and negative free cash flow (-$14.7M) despite a solid balance sheet. The disconnect between operational losses and positive net income indicates reliance on non-operating gains rather than core business strength. Stagnant revenue growth (0% YoY) combined with minimal returns on capital (ROE 2%, ROA 1.5%) in a cyclical energy sector signals fundamental business dysfunction.
Strengths
- Zero long-term debt and strong balance sheet with $262.9M equity
- Adequate liquidity with current ratio of 2.45x and $92.7M cash reserves
- No debt burden providing financial flexibility if operations improve
Risks
- Negative operating cash flow of -$3.0M and negative free cash flow of -$14.7M indicate core business is not generating cash
- Net income dependent on non-operating items to mask -$869K operating loss and -3.9% operating margin
- Flat revenue growth (0% YoY) with minimal capital efficiency despite $344.7M asset base and ROE/ROA below 2%
- Burning $14.7M annually in free cash flow; at current rate, $92.7M cash cushion depletes in 6+ years
- No insider activity in 90 days suggests lack of management confidence in turnaround
Key Metrics to Watch
- Operating cash flow trajectory and return to positive generation
- Revenue growth acceleration and operating margin expansion
- Asset impairment charges and composition of non-operating income driving net income
Financial Metrics
Revenue
22.0M
Net Income
5.2M
EPS (Diluted)
$0.11
Free Cash Flow
-14.7M
Total Assets
344.7M
Cash
92.7M
Profitability Ratios
Gross Margin
N/A
Operating Margin
-3.9%
Net Margin
23.5%
ROE
2.0%
ROA
1.5%
FCF Margin
-66.9%
Balance Sheet & Liquidity
Current Ratio
2.45x
Quick Ratio
2.41x
Debt/Equity
0.00x
Debt/Assets
23.7%
Interest Coverage
-0.09x
Long-term Debt
0.0
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: 2026-05-13T09:31:57.946949 |
Data as of: 2026-03-31 |
Powered by Claude AI