Investment Thesis
LQR House exhibits severe operational distress with negative gross margin (-10%), collapsing revenue (-37.4% YoY), and substantial negative cash flows (-$1.8M FCF). While the balance sheet remains strong with $4.4M cash and minimal debt, the core business is fundamentally broken and burning cash at an unsustainable rate with no clear path to profitability.
Strengths
- Strong balance sheet with $4.4M cash and only $1.6M liabilities
- Excellent liquidity position (9.47x current ratio)
- Zero debt burden providing financial flexibility
Risks
- Severe revenue collapse (-37.4% YoY) to only $222.7K indicates existential business challenge
- Negative gross margin (-10%) shows fundamental product/cost structure is unviable
- Significant negative operating cash flow (-$1.5M) with free cash flow of -$1.8M causing rapid cash depletion
- Deep losses across all profitability metrics with no clear recovery plan
- Complete absence of insider activity (0 Form 4 filings in 90 days) signals lack of management confidence
Key Metrics to Watch
- Gross margin trend and path to positive margins
- Absolute revenue level and whether decline stabilizes
- Monthly cash burn rate relative to $4.4M cash runway
- Operating cash flow trajectory and sustainability
Financial Metrics
Revenue
222.7K
Net Income
-915.0K
EPS (Diluted)
$-0.04
Free Cash Flow
-1.8M
Total Assets
30.0M
Cash
4.4M
Profitability Ratios
Gross Margin
-10.0%
Operating Margin
-1,306.0%
Net Margin
-410.9%
ROE
-3.2%
ROA
-3.1%
FCF Margin
-804.3%
Balance Sheet & Liquidity
Current Ratio
9.47x
Quick Ratio
9.47x
Debt/Equity
0.00x
Debt/Assets
5.2%
Interest Coverage
-2.33x
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: 2026-05-16T07:56:38.455887 |
Data as of: 2026-03-31 |
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