Company Overview
HeartCore Enterprises, Inc. operates as a software development firm that provides software as a service solutions to enterprise customers across Japan, the United States, and international markets. The company focuses on delivering a customer experience management platform that integrates marketing, sales, service, and content management systems, alongside other unspecified offerings. This business model places HeartCore within the Technology sector, specifically the Software - Application industry, where it competes in the provision of digital tools designed to streamline enterprise operations. The company's current scale is defined by a market capitalization of $5.75M, annual revenue of $16.19M, and an employee count of 91. These valuation and financial figures indicate that HeartCore is a small-cap entity operating with a relatively lean workforce to generate its revenue stream. The low market cap relative to the revenue base suggests the market prices the stock based on future growth potential rather than current earnings, while the revenue figure reflects the company's ability to secure enterprise contracts despite the challenges inherent in the software-as-a-service model.
Financial Health
HeartCore Enterprises, Inc. reported revenue of $16.19M for the trailing twelve months, yet it generated a net income of $-11,630,594, resulting in a significant gap that reveals a highly aggressive cost structure or substantial non-operating expenses. The company's EBITDA stands at $-3,955,105, indicating that even after adjusting for depreciation, amortization, and interest, the core operations are currently burning cash. Furthermore, free cash flow is negative at $-2,979,084, which signifies limited financial flexibility and a reliance on existing cash reserves or external capital to fund ongoing operations. The gross margin is 33.1%, which is typical for software companies but is offset by high operating expenses that drive the operating margin to -0.4% and the profit margin down to -66.8%. The company holds $4.95M in cash against $946,719 in debt, creating a liquidity cushion, while the debt-to-equity ratio of 24.75 suggests a leveraged balance sheet structure rather than a conservative one. The current ratio of 1.40 indicates that the company possesses 1.40 dollars in current assets for every dollar of current liabilities, suggesting adequate short-term liquidity to meet immediate obligations. Return on Equity is -163.5% and return on assets is -13.6%, metrics that reveal that management is currently destroying value for shareholders and utilizing assets inefficiently to generate profit.
Valuation Assessment
The valuation of HeartCore Enterprises, Inc. presents a complex picture with a P/E ratio (TTM) listed as N/A due to negative earnings, while the forward P/E is 2.06, implying that the market expects earnings to turn positive in the future. The price-to-book ratio is 1.38, indicating that the market values the company at a 38% premium over its net book value, a premium often found in growth-oriented technology stocks despite current losses. Alternative valuation metrics such as the price-to-sales ratio of 0.36 and an EV/EBITDA of -0.44 suggest that the stock is priced based on revenue multiples rather than profitability, reflecting high risk and high reward expectations. The 52-week high is $1.67 and the 52-week low is $0.22, providing a trading range of approximately 664% where the stock has exhibited significant price volatility. While the specific current price is not listed in the provided facts, the wide gap between the high and low demonstrates that the security trades well below its recent peak, suggesting a significant decline from the 52-week high. The beta value of 1.99 indicates that the stock is nearly twice as volatile as the broader market, meaning price movements are amplified relative to general market trends.
Growth & Income
HeartCore Enterprises, Inc. experienced a revenue growth rate of -81.6% year over year and an earnings growth rate of -96.9%, indicating a severe contraction in both top-line sales and profitability. The earnings decline is significantly faster than the revenue decline, which implies that fixed costs or specific large losses are disproportionately impacting the bottom line more than the top line. As a non-dividend payer, the company has a dividend yield of N/A and a payout ratio of 0.0%, meaning the firm does not distribute cash to shareholders and instead retains earnings, though current earnings are negative, to fund operations or strategic initiatives. The overall growth and income profile for HeartCore Enterprises, Inc. is characterized by deep contraction in financial performance and a lack of income generation through dividends, reflecting a high-risk investment vehicle typical of distressed or turnaround technology companies.