How to Read Microcap 10-Qs in 20 Minutes

The 20-minute sprint plan

• Minutes 1-3: Cover page and share count (basic and diluted). Compare to last quarter; note any ATM or warrant language.
• Minutes 4-8: Balance sheet. Recompute NCAV and NTAV; apply haircuts from the liquidity-trap guide.
• Minutes 9-12: Cash flow statement. Check operating cash burn vs cash balance; capex spikes.
• Minutes 13-16: Footnotes on debt, convertibles, and related parties. Look for covenants, resets, and insider loans.
• Minutes 17-20: MD&A for catalysts (tenders, asset sales) and risks (going concern, customer concentration).

Red flags worth a full stop

• Sequential share count jumps without clear proceeds use.
• New convertible notes or warrants with variable pricing.
• Auditor going-concern emphasis or material weakness.
• Inventory build plus margin compression.
• Revenue with cash collection lags (AR aging worsening).

Outputs to log in your tracker

• Updated NCAV, NTAV, and cash/liabilities ratios.
• Share count changes and potential dilution overhang.
• Any dated catalysts with milestones.
• Decision: size up, hold, trim, or exit.

Internal links and tools

• Balance-sheet events: Shares outstanding changes
• Volume tell: Interesting volume events
• Price pressure: Near-lows scanner
• Sentiment: Short interest changes
• More reading: Resources hub

Compliance note

This guide is educational and not investment advice. Do your own research or consult a professional adviser.