Motorsport Games Inc

Motorsport Games Inc has a market capitalization of $26.0 million and a price-to-book ratio of 12.64, indicating a premium valuation relative to its book value. The company's liquidity position is weak, with a current ratio of 0.47, suggesting it may struggle to meet short-term obligations. The company's equity base is modest at $2.1 million, and its total liabilities of $7.8 million are significantly higher than its equity, raising concerns about financial leverage.

The company's profitability is negative, with a net loss of $1.7 million and an operating loss of $1.2 million, which is below the industry median for profitability metrics. The return on equity is -80.95%, and the return on assets is -16.95%, both of which are poor indicators of capital efficiency and asset utilization. The company's gross profit margin is 78.0%, which is relatively high, but this is offset by high operating expenses that erode profitability.

Motorsport Games Inc's revenue is concentrated in a single business segment, with no disclosed geographic diversification. This lack of diversification increases the company's exposure to market-specific risks and limits its ability to capitalize on growth opportunities in other regions. The company's revenue is primarily derived from the motorsport video game market, which is highly competitive and subject to rapid technological changes.

The company's revenue is projected to decline in the current fiscal year, with a negative outlook for the next fiscal year. The operating cash flow is negative at -$373,670, and the free cash flow is -$1.1 million, indicating a lack of cash generation and potential liquidity constraints. The company's financial performance is constrained by its high operating losses and limited cash reserves, which may hinder its ability to invest in growth initiatives.

The company's risk profile is characterized by medium liquidity risk and low dilution risk. The key financial flag is the negative net cash position after subtracting total debt, which suggests the company may need to raise additional capital to fund operations. The company's dilution potential is low, as there is no significant difference between basic and diluted shares outstanding. The company's financial structure is not heavily leveraged, with a debt-to-equity ratio of 0.02, but its negative cash flows and operating losses pose a significant risk to its financial stability.

Recent events and filings indicate that the company is facing financial challenges, with a significant net loss and negative cash flows. The company's financial statements highlight the need for cost management and revenue growth to improve its financial position. The company's recent performance suggests that it may need to explore strategic alternatives to address its financial constraints and improve its competitive position.

The company achieved positive net income of $6.9 million and operating income of $3.2 million in the latest fiscal period.

Free cash flow surged by 1,526.1% year-over-year to $6.9 million, indicating a significant improvement in cash generation capabilities.

Revenue grew by 30.0% year-over-year to $11.3 million, demonstrating strong top-line momentum in the most recent reporting period.

The debt-to-equity ratio stands at a low 0.02, suggesting minimal leverage risk compared to the cohort median of 0.1.

Gross profit increased to $9.2 million in the latest period, reflecting improved profitability on a per-dollar revenue basis.

The company carries a high credit risk flag, signaling potential difficulties in meeting financial obligations or securing favorable financing terms.

The company faces medium liquidity risk, which could constrain its ability to manage short-term financial obligations effectively.

Revenue has declined at a compound annual growth rate of -7.0% over the last four years, showing long-term top-line weakness.

Revenue $2.0M; Operating income -$661.4k.

• ▍Revenue $2.0M
• ▍Operating income -$661.4k
• ▍Net margin -195.3%

Revenue $1.8M; Operating income -$1.9M.

• ▍Revenue $1.8M
• ▍Operating income -$1.9M
• ▍Net margin -30.8%

Revenue $1.9M; Operating income $2.1M.

• ▍Revenue $1.9M
• ▍Operating income $2.1M
• ▍Net margin 111.9%

Revenue $3.0M; Operating income -$1.2M.

• ▍Revenue $3.0M
• ▍Operating income -$1.2M
• ▍Net margin -55.0%

Revenue $8.7M, +25,7% YoY; Operating income +89,3% YoY.

• ▍Revenue $8.7M, +25,7% YoY
• ▍Operating income +89,3% YoY
• ▍Net income +80,8% YoY
• ▍Free cash flow +96,3% YoY
• ▍Net margin -31.7%

Revenue $6.9M, −33,1% YoY; Operating income +53,3% YoY.

• ▍Revenue $6.9M, −33,1% YoY
• ▍Operating income +53,3% YoY
• ▍Net income +60,2% YoY
• ▍Free cash flow +63,1% YoY
• ▍Net margin -207.3%

Revenue $10.3M, −31,5% YoY; Operating income −1,4% YoY.

• ▍Revenue $10.3M, −31,5% YoY
• ▍Operating income −1,4% YoY
• ▍Net income −8,5% YoY
• ▍Free cash flow −7,3% YoY
• ▍Net margin -348.6%

Revenue $15.1M; Operating income -$34.5M.

• ▍Revenue $15.1M
• ▍Operating income -$34.5M
• ▍Net margin -220.0%