High Tide Inc. — financial distress indicators
Financial-health summary
High Tide Inc.'s reported numbers place it in the 'Watch' financial-health band (distress score 42/100). The main indicators are losses in each of the last 3 years, thin interest coverage and material debt with no ebitda. Independently, the Ohlson accounting model puts its 1-year failure probability at 89% and the market-implied (Merton) default probability is 0.9%. In its favour: operating cash flow is positive over the latest 12 months.
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Net income negative in 3 of 3 fiscal years.
Persistent losses erode equity and the capacity to absorb shocks.
Interest coverage is only 1.44× (lenders typically require ≥ 2–3×).
Low coverage leaves little buffer against a profit dip before a debt-service or covenant breach.
Debt is 43% of assets while EBITDA is not positive.
With no operating earnings, repayment depends entirely on asset sales or fresh capital.
O-score 2.05 → model probability 89%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Operating cash flow is positive over the latest 12 months.
- Revenue still growing (+14% YoY).
📰 Recent news scan
- High Tide Resources Stakes More Ground at Labrador West Iron Project as Drilling Concludes for 2026Yahoo Finance · 2026-09-30
- High Tide Named to Report on Business Ranking of Canada's Top Growing Companies for Sixth Consecutive YearYahoo Finance · 2026-09-28
- High Tide (HITI) Reports Record Revenue. Why is Cash Flow Lagging Operating Profit Growth?Yahoo Finance · 2026-09-17
- High Tide (HITI) Q3 2026 Earnings Call TranscriptYahoo Finance · 2026-09-17
- HITI: High Tide Strong Growth Profile Supports Price Target of US$5.00Yahoo Finance · 2026-09-16
- High Tide Inc (HITI) (Q3 2026) Earnings Call Highlights: Record $198. ...Yahoo Finance · 2026-09-16
⚖️ U.S. legal pathway — Title 11, U.S. Code
Which chapter would apply?
- Chapter 11 — reorganisation. Management usually stays in control as debtor-in-possession; the automatic stay (§362) halts collection; a plan must meet the best-interests test (§1129(a)(7)) and the absolute priority rule (§1129(b)) — creditors are paid before shareholders, who are frequently wiped out.
- Chapter 7 — liquidation. A trustee sells assets and distributes proceeds by statutory priority (§§507, 726).
- Subchapter V (“Chapter 5”) is a fast track for small-business debtors under a statutory debt cap, but SEC-reporting companies are excluded (§101(51D)) — so it rarely applies to listed companies.
What typically triggers a filing
- Payment default or covenant breach lenders will not waive; a debt maturity that cannot be refinanced.
- Auditor going-concern doubt (ASC 205-40 / PCAOB AS 2415) — often itself a default trigger in loan agreements.
- Creditors can force a case with an involuntary petition (§303) if debts are not paid as they come due.
- Delisting after sustained sub-$1 prices or equity deficits cuts off equity funding.
Transactions shortly before filing can be clawed back (preferences — 90 days, §547; fraudulent transfers — 2 years, §548).
Frequently asked questions
What do High Tide Inc.'s financial-health indicators show?
As of 2026-10-08, High Tide Inc.'s public financial data places it in the 'Watch' band with a distress score of 42/100, driven by losses in each of the last 3 years, thin interest coverage and material debt with no ebitda. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is High Tide Inc.'s financial distress score?
42/100 ('Watch'). Ohlson O-score 2.05 (model 1-year failure probability 89%). Merton distance-to-default 2.35 σ (model default probability 0.9%).
What works in High Tide Inc.'s favour?
Operating cash flow is positive over the latest 12 months. Revenue still growing (+14% YoY).
How are shareholders treated if a company enters insolvency?
In a Chapter 11 reorganisation the absolute priority rule pays secured lenders, then unsecured creditors, before shareholders — so existing shares are usually cancelled or heavily diluted. In Chapter 7 the company is liquidated and shareholders rarely recover anything.
Other Pharma & Biotech companies with distress indicators
- ABVC BioPharma, Inc. (ABVC)Very weak 100/100
- AKAN (AKAN)Very weak 100/100
- Endovia Health Sciences, Inc. (EDVA)Very weak 100/100
- Elicio Therapeutics, Inc. (ELTX)Very weak 100/100
- IM Cannabis Corp. (IMCC)Very weak 100/100
- NeuroSense Therapeutics Ltd. (NRSN)Very weak 100/100
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.