EGLX recently expanded its credit facilities by $7M, but of course we would prefer not to see more debt here. It is still losing money and cash flow is negative. The stock has been a disaster, and now its small size adds risk. There could be tax-loss selling. With $200M in revenue it might be an acquisition target, but sentiment towards the stock and management is horrible, and we doubt it does much in the short term. With negative cash flow of $22M in the last 12 months, it will likely need more capital within a year. It can likely stay solvent, by issuing more debt or selling shares, but neither option is attractive to us. Some fundamental improvement has to occur here.
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