InnSuites Hospitality Trust — financial distress indicators
Financial-health summary
InnSuites Hospitality Trust's reported numbers place it in the 'Watch' financial-health band (distress score 36/100). The main indicators are liabilities exceed assets (negative equity), operations consume cash and losses in 2 of the last 3 years. In its favour: high insider/promoter ownership (56%) aligns management with survival.
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.
Total liabilities are 1.07× total assets.
Balance-sheet insolvency test: debts exceeding the fair value of assets is the statutory definition of 'insolvent' in 11 U.S.C. §101(32).
Operating cash flow negative in 2 of the last 3 years.
A business that cannot fund itself from operations depends on external capital to survive.
Recurring net losses.
Repeated losses are a core input in both Ohlson and Altman failure models.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- High insider/promoter ownership (56%) aligns management with survival.
📰 Recent news scan
- Top insider buys and sells disclosed for Monday - Investing.comGoogle News · 2026-09-29
- Innsuites Hospitality EVP Marc Berg sells $361.5m in stock By Investing.com - Investing.com UKGoogle News · 2026-09-28
- InnSuites Hospitality Trust Reports Record First-Half Fiscal 2027 Revenue, Higher Income and Hotel Occupancy - Quiver QuantitativeGoogle News · 2026-09-16
- Two hotels’ combined July revenue hit an all-time record: $600,293 - Stock TitanGoogle News · 2026-09-14
- IHT EXPLORING REVERSE MERGER - Yahoo FinanceGoogle News · 2026-06-18
- IHT Stock Draws Traders As Turnaround Story Builds - Timothy SykesGoogle News · 2026-06-18
⚖️ 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 InnSuites Hospitality Trust's financial-health indicators show?
As of 2026-10-08, InnSuites Hospitality Trust's public financial data places it in the 'Watch' band with a distress score of 36/100, driven by liabilities exceed assets (negative equity), operations consume cash and losses in 2 of the last 3 years. 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 InnSuites Hospitality Trust's financial distress score?
36/100 ('Watch').
What works in InnSuites Hospitality Trust's favour?
High insider/promoter ownership (56%) aligns management with survival.
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.
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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.