Investment Thesis
Unisys exhibits severe financial distress with negative stockholders' equity (-$300M), unprofitable operations (-8.2% net margin), and negative free cash flow generation (-$15.1M). The company faces deteriorating fundamentals including declining revenue (-2.9% YoY), negative operating cash flow, and substantial debt burden that it cannot service from operations, creating acute solvency concerns.
Strengths
- Positive gross profit ($112.5M) with 25.7% gross margin indicates core business retains pricing power
- Cash reserves of $380.2M provide near-term operational liquidity buffer
- Current and quick ratios (1.49x and 1.46x) support short-term obligation coverage
Risks
- Negative stockholders' equity of -$300M signals technical insolvency with liabilities exceeding assets
- Negative free cash flow (-$15.1M) and negative operating cash flow (-$4.4M) indicate inability to sustain operations without capital raises or asset sales
- Declining revenue (-2.9% YoY) paired with 3.7% operating margin and $724M debt creates refinancing risk with weak debt service capacity
Key Metrics to Watch
- Operating cash flow inflection point - critical to achieve positive OCF for viability
- Revenue stabilization and operating margin expansion - current 3.7% margin insufficient for profitability at declining revenue levels
- Debt refinancing timeline and covenant compliance - assess refinancing ability given negative equity and deteriorating operations
Financial Metrics
Revenue
437.6M
Net Income
-35.8M
EPS (Diluted)
$-0.50
Free Cash Flow
-15.1M
Total Assets
1.7B
Cash
380.2M
Profitability Ratios
Gross Margin
25.7%
Operating Margin
3.7%
Net Margin
-8.2%
ROE
N/A
ROA
-2.1%
FCF Margin
-3.5%
Balance Sheet & Liquidity
Current Ratio
1.49x
Quick Ratio
1.46x
Debt/Equity
N/A
Debt/Assets
0.0%
Interest Coverage
2.05x
Long-term Debt
724.0M
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: 2026-05-07T07:18:02.504148 |
Data as of: 2026-03-31 |
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