Reborn Coffee Inc

Reborn Coffee Inc has a market capitalization of $17.82 million and a price-to-book ratio of 6.93, indicating that the market is valuing the company at a premium to its book value. The company's liquidity position is weak, with only $70,250 in cash and equivalents and a current ratio of 0.43, suggesting that it may struggle to meet short-term obligations. The debt-to-equity ratio of 1.0 indicates that the company is financed equally by debt and equity, which could increase financial risk.

The company's profitability is negative, with a return on equity of -38.52% and a return on assets of -9.1%, both significantly below industry norms. The operating loss of $863,570 and net loss of $990,540 highlight the company's inability to generate positive earnings. Gross profit of $1.14 million is insufficient to cover operating expenses, indicating poor cost management or pricing power.

Reborn Coffee Inc's revenue is concentrated in a single business segment, with no disclosed geographic diversification. This lack of diversification increases exposure to regional economic downturns or operational disruptions. The company's capital expenditures of $986,980 suggest ongoing investment in operations, but the negative free cash flow of $1.91 million indicates that these investments are not yet generating returns.

The company's growth trajectory is uncertain, with no disclosed revenue growth in the current fiscal year. The negative operating and free cash flows suggest that the company is not generating sufficient cash to sustain operations or fund growth. The company's financial performance is further constrained by a high debt load, with long-term debt of $2.56 million, which could limit its ability to invest in new opportunities.

The risk assessment indicates a medium liquidity risk and a low dilution risk. The company's net cash position is negative after subtracting total debt, which could lead to liquidity constraints. The low dilution risk suggests that the company is not expected to issue additional shares in the near term, which is a positive sign for existing shareholders.

Recent events, including the company's financial performance and capital structure, suggest that the company is facing significant challenges. The negative earnings and cash flows indicate that the company is not currently profitable and may require additional financing to continue operations. The company's financial disclosures do not provide evidence of recent strategic initiatives or operational improvements that could address these challenges.

Revenue grew at a 17.0% compound annual rate over the four-year period ending in the latest fiscal year.

The company maintains a low leverage band with a debt-to-equity ratio of 0.1076 as of late 2025.

Cash conversion metrics rank above the median for the Restaurants and Bars cohort of 202 companies.

Dilution risk is assessed as low, suggesting limited immediate pressure on existing shareholder equity value.

Current ratio stands at 1.0288, indicating the company holds sufficient current assets to cover short-term liabilities.

The company faces high credit risk, indicating significant potential difficulties in meeting financial obligations or securing financing.

Operating and net margins rank in the bottom quartile compared to 217 peers in the Restaurants and Bars sector.

Liquidity risk is rated as medium, highlighting potential challenges in managing cash flow for daily operations.

Revenue $3.2M, +42,1% YoY; Operating income −3,2% YoY.

• ▍Revenue $3.2M, +42,1% YoY
• ▍Operating income −3,2% YoY
• ▍Net income −3,3% YoY
• ▍Free cash flow −11,4% YoY
• ▍Net margin -109.7%