SAFX

XCF Global is a barely-revenue sustainable-aviation-fuel (SAF) developer that reverse-merged into public markets via the Focus Impact BH3 SPAC in 2024. The headline that makes this screen 'cheap' — a 0.8x P/E on $0.52 diluted EPS and $74M net income — is an accounting illusion. Net margin of 355.5% and ROE of 196.5% cannot come from operations: operating income was -$67.9M and gross profit was actually NEGATIVE at -$3.77M (gross margin -18.1%), meaning the company sells its blended Jet-A fuel for less than it costs to produce. The $74M 'profit' is non-cash — almost certainly fair-value swings on the convertible notes and warrants described at length in the MD&A — and tells you nothing about earning power. Strip it away and this is a deeply pre-profitable business burning cash.

The balance sheet is the disqualifier. Cash was $155K at year-end (down 62%; the MD&A confirms $159,232 vs $413,006 a year earlier), against current liabilities of $249M and current assets of only $27.6M — a ~$221M working-capital deficit and a current ratio near 0.11. Liabilities are 10.1x equity, equity is a thin $37.7M, and long-term debt is $124M. Operating cash flow was -$17.9M and the company only stayed alive via $19.2M of financing 'primarily from proceeds from related party note payable and proceeds from borrowing.' Management's own language — 'we are actively managing current cash flows until such time that we are profitable' — is effectively a going-concern posture.