Archived research. The era-1 framework is part of the Runchey Research archive (methodology era 1) and is no longer actively updated. Everything remains published at its original URL. Browse the archive
Roadkill Radar
Can this distressed company survive and recover?
Additional derived signals may emerge during analysis based on company-specific findings.
The Roadkill Radar analyzes beaten-down stocks to determine if market pessimism is overblown or if the company is "cheap for a reason."
Named for the contrarian practice of scanning what others have left for dead — sometimes the roadkill gets back up. This lens asks: "Is this distress temporary and recoverable, or terminal?"
Signals Produced
What This Lens Catches
Liquidity crunch
Example: Cash runway < 12 months with no committed financing
Look for: Cash burn rate, committed credit facilities
Debt maturity wall
Example: Large maturities due with no refinancing plan
Look for: Debt schedule, refinancing announcements
Covenant breach risk
Example: EBITDA trending toward covenant violation
Look for: Covenant headroom calculations
Turnaround execution
Example: Consistent cost cuts translating to margin improvement
Look for: Restructuring progress, margin trajectory
Management credibility gap
Example: Repeated missed guidance, departures
Look for: Guidance history, executive turnover
Analysis Stages
Liquidity Runway
How long can the company survive without external financing?
Capital Structure Assessment
What are the refinancing requirements and risks?
Operational Turnaround Feasibility
Can operations generate the cash needed to survive?
Management Credibility
Does management have a track record of execution?
Catalyst Identification
What could change the trajectory?
When This Lens Applies
Apply When
- Stock down >30% from 52-week high or multi-year low
- Credit rating below investment grade or on negative watch
- Going concern language in auditor report
- Significant restructuring or cost reduction program underway
- Negative free cash flow with declining cash balance
- Trading at distressed multiples (e.g., EV/EBITDA <5x with reason)
Skip When
- Investment-grade credit with stable outlook
- Consistent profitability and positive free cash flow
- No material debt or liquidity concerns
- Assess accounting manipulation (that's Fugazi Filter)
- Predict stock price or timing of recovery
- Make buy/sell recommendations
- Apply to healthy, profitable companies
- Assess competitive position in detail (that's Moat Mapper)