LMFA

LM Funding is a $2.4M-market-cap shell in transition, and none of its three legs holds up. The legacy specialty-finance business (buying delinquent Florida HOA receivables) is shrinking — revenue fell 19.6% to $8.84M in FY2025 and is down from the $13.0M FY2023 peak. Bolted onto it are a Bitcoin mining operation with, in management's own words, a 'limited operating history... history of operating losses and negative cashflow,' and a brand-new Bitcoin treasury strategy the 10-K concedes 'is novel,' 'has not been tested over an extended period,' and ties the common stock's value directly to Bitcoin's price. The result is a company whose equity value is a leveraged, unhedged bet on Bitcoin wrapped around a declining collections business.

The numbers are alarming. FY2025 net income was -$26.9M on $8.84M of revenue — a -304% net margin and -258% operating margin — and operating cash flow was -$14.0M, well in excess of the entire $2.41M market cap. ROE is -87.9% and the accumulated deficit sits at -$92.6M. Financing has come from the printing press: shares outstanding jumped 214.8% year-over-year, and diluted EPS was still -$3.28. Perversely, the company paid $7.97M for buybacks in the same year it was diluting and bleeding cash — a capital-allocation contradiction that erodes the case for management's stewardship. Current-portion debt exploded 1,714% to $7.01M, hardening near-term obligations against negative operating cash flow.