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# B. Riley's Balance Sheet Is In Bad Shape With A Risky Solvency Position (Archive)
- URL: https://www.huntingalphas.com/b-rileys-balance-sheet-is-in-bad-shape-with-a-risky-solvency-position-archive/
- Published: 2024-02-18T13:05:00.000Z
- Updated: 2026-02-27T08:48:22.000Z
- Description: RILY’s core business faces structural solvency stress despite headline liquidity and recent short squeeze.
- Author: Vish (Hunting Alphas)
- Tags: 5-Minute Pitches, #noindex, Archive, #sa-origin, RILY, Financials

*This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.*

## Elevator Pitch

- This article exposes balance sheet risks to B. Riley which occur before the claims of equity investors, preferred equity investors and lenders.
- RILY's core business is in a risky solvency position; excluding the impact of highly volatile trading revenue streams, RILY has negative EBIT levels, so net interest expense is not covered.
- The company has a negative net assets positions excluding goodwill. Yet, the stock trades above book value. This implies further downside ahead.
- Short interest is high, but there was already a short squeeze in late January 2024, which I believe reduces the chances of another short squeeze until new lows are made. However, the short borrow fees are too high to initiate fresh short sells.
- The balance sheet problems in B. Riley are structural. Hence, I believe it is highly unlikely that Q4 earnings would lead to any kind of sustained reversal.

Read the full article [here](https://seekingalpha.com/article/4671253-b-riley-balance-sheet-bad-shape-risky-solvency-position?ref=huntingalphas.com).

#### Disclosures and Disclaimers

**Past performance ≠ future results. Not investment advice. See* [**full Disclaimer*](https://www.huntingalphas.com/disclaimer/)**.*