Reservoir Media Inc. Common Stock (RSVR)

FairStock Score: 21/100 — RISKY

Key Financials

Concerns

• Trades significantly above Graham Number ($4) with negative 183% margin of safety—limited downside protection
• Altman Z-Score of 0.8 places it in the financial distress zone—elevated bankruptcy risk
• No meaningful dividend despite modest growth—total return depends entirely on multiple expansion

AI Analysis

Reservoir Media Inc. Common Stock is a micro-cap communication services company valued at $665 million. The business generates $170 million in annual revenue with a 1.3% net margin. From a quality standpoint, Reservoir shows distressed Altman Z-Score of 0.8 warrants caution and modest 2% ROE. On valuation, the stock is commanding a steep 101.4x multiple, with trades far above its Graham Number ($4) with no margin of safety. Growth dynamics show revenue growing at 7.7% and profit growth of -58.1%. Our composite FairStock Score of 21/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

At 101x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer