Aeries Technology, Inc (NASDAQ:AERT) is facing scrutiny over its debt levels, with concerns raised about the company’s ability to manage its financial obligations. As of June 2024, Aeries Technology had $8.07 million in debt, an increase from the previous year. With $4.20 million in cash, the company has a net debt of approximately $3.87 million. While Aeries Technology has liabilities totaling $23.8 million more than its cash and near-term receivables, its market capitalization of $53.4 million suggests it could raise capital if needed.
However, the company’s lack of profitability is a cause for concern. Despite a 28% revenue growth to $73 million, Aeries Technology reported an EBIT loss of $11 million in the last year. The company also burned through $7.8 million in cash, indicating a risky financial situation. Analysts are warning investors about the potential risks associated with Aeries Technology, with three significant warning signs identified.
Investors are advised to approach Aeries Technology with caution and consider the company’s financial health before making any investment decisions. The company’s balance sheet is under strain, and its lack of profitability raises concerns about its ability to manage its debt effectively. Ultimately, investors should focus on companies with strong financial positions to mitigate risks associated with high debt levels.
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