Forensic Analysis · Software & SaaS · as of Nov 8, 2026
Fatpipe Inc (FATN)
A forensic read on Fatpipe Inc built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
C · Mixed — selective
Forensic grade
Safe
Financial health
7.4
Distress distance
Watch
Earnings quality
5
Forensic signals
24.2%
ROE
17.9%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (auditor quality, say on pay, board independence, going concern). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Fatpipe Inc earns a C (Mixed — selective) forensic quality grade, and its balance-sheet distress test reads 7.4, placing it in the Safe zone. 5 forensic signals were flagged in its latest SEC filings, led by cash conversion.
What the filings flag
-0.19×
FY2025–FY2026
Cash conversion.Over FY2025–FY2026, cumulative operating cash flow was -0.19× cumulative net income. Reported profit is not turning into cash. The shortfall is profit tied up in working capital rather than collected — the accrual and receivables lines below show where.Cash conversion: operating cash flow divided by net income, the share of profit that arrived as cash.
+31.0%
FY2025→FY2026
Accruals ratio (% of NOA).Net operating assets grew +31.0% relative to their own average in FY2026 — scaled by NOA itself, not by total assets, which is what the Forensic Screens card's own accrual row divides by. Accruals are building sharply — a large slice of profit sits in operating assets, not cash. An accrual is a claim that still has to be collected or written down, so the gap resolves in a later period whichever way it goes. The build is led by receivables up +14% against revenue +18% and payables paid down 11% against +63% in cost of sales. A cash-flow measure on the same base agrees: reported earnings ran ahead of operating cash by 27% of net operating assets, against an accruals ratio of 31.0%. The two are computed differently: the accruals ratio is the change in net operating assets over average net operating assets, while the cash-flow figure is net income less operating cash flow over that same average.Accruals ratio: the year-over-year change in net operating assets, relative to their own average.NOA (net operating assets): the money tied up in running the business, operating assets minus operating liabilities.
+8.9%/yr
FY2025–FY2026
Share-count dilution.Diluted share count changed +9% over the last 1 year to FY2026 (+8.9%/yr). The count is growing — 12.9M shares in FY2025, 14.0M in FY2026: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~8.9% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2025 has been diluted ~8%.
14.5%
FY2026
Return on invested capital.Return on invested capital is 14.5% in the latest fiscal year, against 11.7% in FY2025. After-tax operating profit was $2M in FY2025 and $3M in FY2026, with operating income at 21.3% of revenue in FY2025 and 18.7% in FY2026. The capital base behind it grew +16% across FY2025–FY2026, from $19M to $22M, and the return did not fall doing it, so the dollars added over that window earned at least the 11.7% the older base was already earning.
4% of rev
FY2026
Stock-based comp load.Stock-based compensation ran 4% of revenue in FY2026 — about $0.05 per diluted share. No cash left the business to pay it, which is why operating cash flow adds it back. Net of repurchases the diluted count still rose about 8.9% a year across FY2025–FY2026, above the level at which the count is a material claim on a stake, and only one year's change is on file — enough to state what a holder gave up, not enough to say whether the rate is climbing or coming down. Stock compensation is one source of that issuance; acquisition consideration, equity raises, convertibles and other employee plans also net into the count, and these figures do not separate them.
Key fundamentals
Latest Revenue$19.2M
Revenue Growth YoY+17.9%
Net Margin25.9%
Free Cash Flow-$832,876
Return on Equity24.2%
Debt / Equity0.20x
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Fatpipe Inc's actual 10-K/10-Q/8-K filings?