AITX stock analysis: CEO salary raises some red flags

The Artificial Intelligence Technology Solutions (OTCMKTS: AITX) stock price has staged a strong bull run this year, helped by the strong demand for AI companies. It has soared by over 272% from its lowest level this year and is hovering near its highest point since July 2023. This surge has given it a market cap of over $80 million.

Red flags in AITX results

AITX’s stock has done well because of the ongoing demand for AI and robotics companies. This week, this trend accelerated when Nvidia published strong financial results that revealed its revenue growth accelerated by over 260% in the first quarter. Its $24 billion quarterly revenue was higher than what it made in 2019. 

AITX is a company that builds robots through its subsidiaries like RAD, RAD-R, RAD-M, and RAD-G. RAD creates stationary workflow automation solutions while RAD-M creates robots for mobile workflows. RAD-R creates solutions used by residential and corporate security companies while RAD-G is a software company.

The most recent AITX news was that the company unveiled its Autonomous Intelligent Response (AIR) solution that is available to all its clients. AITX also published mixed financial results that revealed strong revenue growth and rising losses.

Its annual revenue jumped from to over $2.2 million in the last financial year from $1.3 million a year earlier. However, its annual loss jumped to over $20.7 million from the previous year’s $18.1 million. 

AITX revenues

Most of its expenses came from its General and Administrative segment, which jumped to over $10.5 million. Steve Reinharz, the CEO, made a fortune as his wages, salaries, and payroll levies rose by over $731k even as those paid to staff dropped by $218k. 

His stock-based compensation was over $1.5 million. Altogether, his annual compensation rose to over $2.8 million in 2023 from $1.08 million a year earlier. This figure is higher than the company’s total annual revenue. 

Its CFO, Anthony Brenz, earned $208k in 2023 from $191k in 2022. All this happened even as the stock plunged by over 80% by 87% from its highest point in June and its lowest point in November.

CEO and CFO compensation

Worse, the company’s balance sheet is not all that good. Its working capital – current assets minus current liabilities – jumped from $11 million to over $18.1 million. It ended the last financial year with just $105k in cash, down from $939k in 2023. 

AITX stock price forecast

AITX chart by TradingView

The daily chart shows that the AITX share price has jumped sharply recently. Most of these gains came recent meme stock frenzy. It has moved above the crucial resistance level at $0.0062, its highest swing in December 2023. 

The 50-day and 25-day moving averages have made a bullish crossover pattern. However, it has also formed a small double-top pattern, a popular bearish sign. Therefore, there is a likelihood that the stock will have a bearish breakout in the coming weeks.