Alpine 4 Holdings Inc (ALPP)

[Renegades17]

Rebutting some of your points

1. I agree, the net income was largely due to non-cash reversals. That said, ALPP was cash flow from operations positive to the tune of $574k in the most recent quarter. That is AFTER debt service costs. In fact, the company has been cash flow from operations (again, after debt service costs) for the past two quarters. In Q2, the company had CFFO of $351k, so that was a nice sequential uptick.

2. Looking at the balance sheet to judge creditworthiness is highly misleading as it's based on historical costs. No credit analyst would do that (I was a former high yield investment banker and worked for a private equity firm, so I'm keenly aware of credit analysis). One should look at cash flow for a business like this, particularly given a large portion of the debt (~44%) are lease obligations that have to be capitalized now due to changes in GAAP.

3. Looking at number of years to repay debt is misleading as ALPP will almost certainly REFINANCE debt rather than repay. There will always be some debt in the captial structure given their approach.

4. Net worth is negative, but again, that's based on historical costs and not relevant on a forward looking basis. In fact, ALPP's negative net worth is more than entirely due to accumulated losses. That's backward looking and irrelevant when evaluating the stock.

The stock is admittedly struggling due to an absence of buyers rather than inordinate selling pressure IMO. Unfortunately, there aren't any meaningful institutional holders of the stock that I'm aware of, but hopefully that will change as the year progresses and visibility on an uplist improves.