MBAI — financial distress indicators
Financial-health summary
MBAI's reported numbers place it in the 'Weak' financial-health band (distress score 60/100). The main indicators are operating profit does not cover interest, severe working-capital shortfall and share price down >80% from 52-week high. Independently, the Ohlson accounting model puts its 1-year failure probability at 90% and the market-implied (Merton) default probability is 0.0%. In its favour: high insider/promoter ownership (48%) 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.
Interest coverage (EBIT / interest) is -12.83×.
When EBIT < interest, debt service is funded from cash reserves or new borrowing — the classic precursor to payment default and covenant breach.
Current ratio is 0.05 (current assets cover 5% of near-term obligations).
Cash-flow insolvency test: inability to pay debts as they fall due is the trigger for both U.S. involuntary petitions and Indian IBC default.
Price is -86% from its 52-week high.
Equity markets price distress early; collapses of this size usually reflect fear of wipe-out in a restructuring.
O-score 2.17 → model probability 90%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Recurring net losses.
Repeated losses are a core input in both Ohlson and Altman failure models.
Operating cash flow negative in 3 of the last 3 years. The company is profitable, so this likely reflects working-capital or loan-book growth.
A business that cannot fund itself from operations depends on external capital to survive.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- High insider/promoter ownership (48%) aligns management with survival.
📰 Recent news scan
- MBody AI Adds 2 Patents Pending for Its Enterprise AI Workforce PlatformYahoo Finance · 2026-10-08
- MBody AI Brings Physical AI Robotics Platform to ThinkEquity and Maxim InvestorsYahoo Finance · 2026-10-07
- MBody AI Presents AI Robot Workforce Platform at Lytham Fall 2026 ConferenceYahoo Finance · 2026-09-28
- MBody AI Completes Name Change Following Merger and $10 Million OfferingYahoo Finance · 2026-09-16
- MBody AI to Present at the H.C. Wainwright 28th Annual Global Investment ConferenceYahoo Finance · 2026-09-10
- MBody AI Advances AI Robotics Rollout at Mohegan SunYahoo Finance · 2026-09-09
⚖️ 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 MBAI's financial-health indicators show?
As of 2026-10-08, MBAI's public financial data places it in the 'Weak' band with a distress score of 60/100, driven by operating profit does not cover interest, severe working-capital shortfall and share price down >80% from 52-week high. 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 MBAI's financial distress score?
60/100 ('Weak'). Ohlson O-score 2.17 (model 1-year failure probability 90%). Merton distance-to-default 4.79 σ (model default probability 0.0%).
What works in MBAI's favour?
High insider/promoter ownership (48%) 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.
Other Unclassified companies with distress indicators
- CNEY (CNEY)Very weak 100/100
- EPOW (EPOW)Very weak 100/100
- GIBO (GIBO)Very weak 100/100
- GNS (GNS)Very weak 100/100
- HKPD (HKPD)Very weak 100/100
- HUBC (HUBC)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.