Forensic Analysis · Technology / Software · as of Oct 19, 2026
Motorsport Games Inc. (MSGM)
A forensic read on Motorsport Games Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
D · Weak — demands caution
Forensic grade
Distress
Financial health
-17.4
Distress distance
Watch
Earnings quality
5
Forensic signals
102.2%
ROE
30.0%
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 (red flags, 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.
Motorsport Games Inc. earns a D (Weak — demands caution) forensic quality grade, and its balance-sheet distress test reads -17.4, placing it in the Distress zone. 5 forensic signals were flagged in its latest SEC filings, led by accruals ratio (% of NOA).
What the filings flag
+137.7%
FY2024→FY2025
Accruals ratio (% of NOA).Net operating assets grew +137.7% relative to their own average in FY2025 — 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. Net operating assets also rose $186,729 through acquisitions (increase in goodwill and intangibles); that purchase is investing and is excluded from this ratio. The build is led by payables paid down 69% against -35% in cost of sales and receivables up +55% against revenue +30%. A cash-flow measure on the same base agrees: reported earnings ran ahead of operating cash by 193% of net operating assets, against an accruals ratio of 137.7%. 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.
+37.0%/yr
FY2023–FY2025
Share-count dilution.Diluted share count changed +88% over the last 2 years to FY2025 (+37.0%/yr). The count is growing — 2.6M shares in FY2023, 4.8M in FY2025: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~37.0% 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 FY2023 has been diluted ~47%.
7% of rev
FY2025
Stock-based comp load.Stock-based compensation ran 7% of revenue and 27% of free cash flow in FY2025 — about $0.16 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 37.0% a year across FY2023–FY2025 and that rate is not falling, so total profit has to grow by that much annually before any of it reaches a share. 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.
-$12.4M
FY2023–FY2025
Cash burn vs. reported loss.Over FY2023–FY2025, the company reported a cumulative net loss of $10.1M against operating cash flow of -$12.4M. Cash burn ran heavier than the reported loss — something outside net income (working capital, a cash item not in the P&L) is consuming cash faster than the loss alone implies.
72d DSO
FY2024→FY2025
Receivables vs revenue.Days sales outstanding moved from 61 to 72 days FY2024→FY2025 (receivables +55% vs revenue +30%). Across FY2023–FY2025 the day count ran 39 → 61 → 72 days — the latest step continues a climb that was already under way, which is the persistence that separates a collection problem from a busy quarter. Receivables grew, but deferred revenue grew +190% over the same period too — rising alongside rising unearned revenue reads as upfront billing on multi-period contracts, not slipping collections. Both figures are measured on period-end balances rather than the beginning-plus-ending average, because averaging needs the balance a year before every reading — FY2024's opening balance is on file, but across the 3 fiscal years read here (FY2023–FY2025) the average yields only 2 day counts (1 step), too few to tell a climb from one year's move.
Key fundamentals
Latest Revenue$11.3M
Revenue Growth YoY+30.0%
Revenue CAGR (2yr)+27.9%
Net Margin61.3%
Free Cash Flow$3.0M
Return on Equity102.2%
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 Motorsport Games Inc.'s actual 10-K/10-Q/8-K filings?