CGrowth Capital Inc (CGRA)

[Prudent Capitalist]

Not to mention the rapidly accelerating reductions in stockholders equity, which should be of great concern to all shareholders here. The reduction in stockholders equity for all of 2016 was (-6%). And, now in just the first quarter of 2017, Stockholders Equity suffered a much larger reduction of more than (-13.5%). This does not bode well for shareholders, on top of all the other negative aspects of the fins. The growing losses and cash burn cannot be sustained here, particularly when the debt and interest payments to service the debt are mounting rapidly and there is no positive cash flow to adequately service the interest payments on the high interest junk bonds.

Whenever you see stockholders equity rapidly declining, as it is here with CGRA, as confirmed in the Q out Friday and in the recent annual report, it is certainly not a positive for shareholders, but rather is a huge negative and red flag.

CGRA = Capital Gone Reverse Appreciation