Investment Thesis
Worksport is in acute financial distress with -$8.2M operating cash burn against only $3.3M revenue and $566.6K cash reserves, creating imminent liquidity crisis. Net losses of $5.8M on flat revenue indicate fundamental business model failure, while negative operating margins of -173.4% demonstrate the company is spending $1.73 for every dollar of revenue.
Strengths
- Gross margin of 25.8% indicates underlying product profitability before operating expenses
- EPS improved 45.9% YoY suggesting loss trajectory is narrowing
- Moderate leverage at 0.17x debt-to-equity ratio limits additional financial distress from debt
Risks
- Critical cash burn of -$8.2M operating CF with only $566.6K cash creates bankruptcy risk within months
- Revenue stagnation at 0% YoY with no growth momentum in competitive auto parts sector
- Operating losses of $5.7M on $3.3M revenue represent structural business model failure
Key Metrics to Watch
- Cash balance and operating cash flow for solvency status
- Revenue growth acceleration to validate market demand and business viability
- Operating expense reduction and path to positive EBITDA
Financial Metrics
Revenue
3.3M
Net Income
-5.8M
EPS (Diluted)
$-0.54
Free Cash Flow
-8.3M
Total Assets
27.9M
Cash
566.6K
Profitability Ratios
Gross Margin
25.8%
Operating Margin
-173.4%
Net Margin
-175.9%
ROE
-29.2%
ROA
-20.9%
FCF Margin
-251.7%
Balance Sheet & Liquidity
Current Ratio
1.95x
Quick Ratio
0.27x
Debt/Equity
0.17x
Debt/Assets
28.3%
Interest Coverage
-46.47x
Long-term Debt
3.4M
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: 2026-05-15T10:24:48.642426 |
Data as of: 2026-03-31 |
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