Company Overview
Sky Quarry Inc. functions as an integrated entity within the energy sector, specifically operating in the oil and gas industry to provide production, refining, and environmental remediation services across the United States. The company's operational scope includes the recycling of waste asphalt shingles alongside the remediation of oil-saturated sands and soils, while also refining heavy crude oil to produce diesel fuel. This business model positions the firm as a specialized player in both upstream production and downstream refining capabilities. The company currently maintains a market capitalization of $72.51M and employs a workforce of 26 individuals to support these operations. With annual revenue recorded at $16.40M, the market cap indicates a valuation that is significantly elevated relative to its revenue base, suggesting the market places a premium on its specific niche capabilities in remediation and heavy crude processing rather than valuing it strictly on a traditional revenue multiple.
Financial Health
The company reported a revenue of $16.40M for the trailing twelve months, yet this top-line activity resulted in a net income of $-13,537,046, revealing a cost structure where expenses far exceed earnings before interest and taxes. Specifically, the EBITDA stands at $-9,718,233, indicating that operating costs, including the costs of goods sold and administrative expenses, are consuming the majority of the generated revenue. The free cash flow is recorded at $-3,459,354, which signifies a lack of financial flexibility as the company is burning cash rather than generating liquidity from its core operations. This negative cash flow situation is further compounded by a gross margin of -21.2%, an operating margin of -190.9%, and a profit margin of -82.5%, all of which indicate that the company is operating at a loss at every level of its financial statement. On the liability side, the company holds $362,517 in cash against $10.62M in debt, resulting in a debt-to-equity ratio of 194.45, which characterizes the balance sheet as highly leveraged and exposed to refinancing risks. Liquidity is severely constrained, evidenced by a current ratio of 0.21, meaning current assets are less than a quarter of current liabilities. Return on equity is -192.3% and return on assets is -28.6%, metrics that reveal management is currently unable to generate positive returns on the capital invested or the assets utilized in the business.
Valuation Assessment
The trailing twelve-month P/E ratio is listed as N/A, while the forward P/E is also N/A, implying that the company is currently unprofitable and traditional earnings-based valuation metrics cannot be applied to assess its expected earnings trajectory. Instead, the price-to-book ratio stands at 1.30, indicating that the market values the company at 30% above its book value despite the significant losses and negative earnings. Alternative valuation metrics provide further insight, with a price-to-sales ratio of 4.42 and an EV/EBITDA of -1.83, suggesting that investors are pricing the stock based on potential future turnaround scenarios rather than current profitability. Regarding price momentum, the 52-week high is $15.52 and the 52-week low is $1.66, placing the stock's trading range within a wide band that reflects high volatility typical of small-cap energy explorers. The beta is listed as N/A, meaning there is insufficient data to quantify the stock's price volatility relative to the broader market, though the wide spread between the high and low suggests significant price sensitivity to market conditions.
Growth & Income
Revenue growth for the year-over-year period is -72.4%, while earnings growth is listed as N/A due to the negative earnings base, indicating that the company is contracting significantly rather than expanding its top line. Because the company is currently unprofitable with negative earnings, it does not pay a dividend, resulting in a dividend yield of N/A and a payout ratio of 0.0%, which necessitates that the company reinvests any available resources or seeks external capital to fund operations and growth. The absence of a dividend payout confirms that the firm is in a preservation mode where earnings are not distributed but are instead required to cover the substantial operating losses and debt obligations. Overall, the growth and income profile for Sky Quarry Inc. is characterized by significant revenue contraction, a complete absence of shareholder returns via dividends, and a reliance on capital markets to sustain operations in the absence of organic profitability.