B Riley Financial (RILY) AI Stock Analysis

• Market Cap: $91.80M
• Dividend Yield: 68.26%
• Average Volume (3M): 947.92K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.78
• Revenue Growth: -17.51%
• EPS Growth: -1376.05%
• Country: US
• Employees: 2,383
• Sector: Financial
• Sector Strength: 79
• Industry: Financial - Conglomerates
• EPS (TTM): -27.76
• Shares Outstanding: 30,497,066
• 10 Day Avg. Volume: 528,810
• 30 Day Avg. Volume: 947,917
• PEG Ratio: <0.01
• Price to Book (P/B): -0.18
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.28
• Enterprise Value/Market Cap: 22.79
• Enterprise Value/Revenue: 0.37
• Enterprise Value/Gross Profit: 2.80
• Enterprise Value/Ebitda: -3.00
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 48 Neutral
• Price Target: ―

B Riley Financial's overall score reflects a struggling financial performance with ongoing losses and high leverage. Despite positive steps in corporate restructuring and partnerships aimed at reducing debt and enhancing growth, the technical indicators suggest bearish sentiment, and valuation metrics highlight profitability challenges. Addressing Nasdaq compliance and ensuring operational stability are critical for future improvement.

B Riley Financial Business Overview & Revenue Model

Company Description

B. Riley Financial, Inc. (RILY) is a diversified financial services company headquartered in Los Angeles, California. The company operates across several sectors, offering a wide range of services such as investment banking, institutional brokerage, asset management, and financial advisory services. B. Riley Financial serves a broad array of clients, including public and private companies, institutional investors, and high net-worth individuals. The company is known for its expertise in providing tailored solutions and strategic advice to meet the unique needs of its clients.

How the Company Makes Money

B. Riley Financial generates revenue through multiple streams, primarily from fees and commissions associated with its investment banking and brokerage services. The company earns underwriting fees from assisting in capital raising activities such as initial public offerings (IPOs) and secondary offerings. Additionally, B. Riley Financial gains revenue from advisory fees for merger and acquisition (M&A) guidance, restructuring, and other financial consulting services. Asset management services contribute to recurring revenue through management fees based on assets under management (AUM). The company's brokerage division earns commissions on trades executed for institutional and retail clients. Furthermore, B. Riley Financial benefits from its proprietary trading activities and investments, adding another layer to its income. Significant partnerships with other financial institutions and a strong network of corporate clients also enhance its revenue-generating capabilities.

B Riley Financial Financial Statement Overview

Summary

B Riley Financial faces significant challenges with profitability and financial stability, marked by consistent net losses and high leverage. While revenue growth has shown signs of recovery, the company's ability to maintain sustainable operations remains under pressure. Improving cash flow management is a positive sign, but returning to profitability and reducing leverage are crucial for long-term success.

Income Statement

B Riley Financial has experienced fluctuating revenue growth, with a notable increase from 2022 to 2023, reversing the decline from 2021. However, profitability remains a concern with persistent negative net income, resulting in negative net profit margins. The gross profit margin remains strong, indicating efficient cost management, but EBIT and EBITDA margins have weakened from prior years.

Balance Sheet

The balance sheet shows high leverage with a substantial debt-to-equity ratio, increased from the previous year. The return on equity has turned negative due to net losses, while the equity ratio has further declined, reflecting increased financial risk. Continued reliance on debt financing could be risky without a clear path to profitability.

Cash Flow

Cash flow analysis reveals improved free cash flow from 2022 to 2023, indicating better cash management. Nonetheless, operating cash flow to net income ratio suggests challenges in converting income into cash, although free cash flow has improved relative to net income. The company needs to ensure sustainable cash flow in light of its operational losses.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	1.28B	1.64B	872.99M	1.74B	902.72M	652.11M
Gross Profit	747.91M	1.05B	872.99M	1.61B	787.36M	553.57M
EBITDA	-496.22M	94.29M	-39.30M	733.09M	378.83M	185.84M
Net Income	-856.79M	-99.91M	-159.83M	445.05M	205.15M	81.61M
Balance Sheet
Total Assets	2.16B	6.07B	6.11B	5.85B	2.66B	2.32B
Cash, Cash Equivalents and Short-Term Investments	159.25M	231.96M	268.62M	278.93M	103.60M	104.27M
Total Debt	2.16B	2.45B	2.55B	2.10B	1.06B	866.93M
Total Liabilities	2.58B	5.71B	5.43B	4.80B	2.12B	1.93B
Stockholders Equity	-497.58M	291.12M	446.51M	661.27M	512.59M	360.66M
Cash Flow
Free Cash Flow	323.10M	16.79M	2.73M	50.22M	55.64M	-33.85M
Operating Cash Flow	331.75M	24.50M	6.65M	50.89M	57.69M	-30.39M
Investing Cash Flow	13.75M	301.17M	-32.29M	-956.53M	-128.45M	-295.40M
Financing Cash Flow	-435.19M	-365.92M	17.64M	1.08B	69.54M	250.18M

B Riley Financial Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.93
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RILY, the sentiment is Negative. The current price of 2.93 is below the 20-day moving average (MA) of 2.99, below the 50-day MA of 3.04, and below the 200-day MA of 4.39, indicating a bearish trend. The MACD of -0.04 indicates Negative momentum. The RSI at 43.53 is Neutral, neither overbought nor oversold. The STOCH value of 55.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RILY.

B Riley Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RJF	77 Outperform	$30.61B	14.62	18.84%	1.32%	11.78%	25.68%
PJT	74 Outperform	$5.81B	29.29	96.33%	0.60%	16.04%	60.32%
EVR	72 Outperform	$10.32B	25.58	29.73%	1.24%	26.88%	68.65%
SF	72 Outperform	$10.65B	19.76	11.48%	1.78%	12.85%	20.21%
LAZ	69 Neutral	$4.51B	16.70	59.68%	4.20%	9.54%	―
Sector *	67 Neutral	$16.66B	11.44	9.71%	3.92%	11.61%	-10.70%
RILY	48 Neutral	$91.80M	―	-34.32%	68.26%	-17.51%	-1376.05%

B Riley Financial Corporate Events

B Riley Financial Faces Nasdaq Compliance Challenges

B. Riley Financial has received a notification of non-compliance from Nasdaq due to delayed filings of its quarterly reports for June and September 2024. While this notice does not immediately affect its Nasdaq listing, the company must submit an updated compliance plan by December 5, 2024. Despite facing significant challenges, B. Riley is committed to resolving these delays and anticipates returning to a normal filing schedule in 2025.

B Riley Financial Partners with Oaktree for Strategic Growth

B. Riley Financial and Oaktree Capital Management have launched a partnership in the Great American Group, a leader in valuation, appraisal, and real estate services. This new venture follows a major transaction that sees B. Riley gaining approximately $235 million and retaining significant equity in the business. The collaboration aims to leverage Oaktree’s expertise to propel the Great American Group’s growth, reducing B. Riley’s debt and offering substantial future gains.

B Riley Financial Faces Challenges Amid Franchise Group Bankruptcy

B. Riley Financial faces significant challenges as Franchise Group enters bankruptcy, impacting investments worth millions. Despite setbacks, CEO affirms the company’s resilience, highlighting strategic asset sales and strong capital reserves. B. Riley is positioning itself for growth with a robust talent pool and sound financial strategies, aiming to thrive amidst adversity and restore confidence among stakeholders.