Balance Sheet Growth

Retrieve and analyze year-over-year growth in key balance sheet items for public companies using Octagon MCP.

Prerequisites

Ensure Octagon MCP is configured in your AI agent (Cursor, Claude Desktop, Windsurf, etc.). See references/mcp-setup.md for installation instructions.

Query Format

Retrieve year-over-year growth in key balance-sheet items for <TICKER>, limited to <N> records and filtered by period <FY|Q>.

MCP Call:

{
  "server": "octagon-mcp",
  "toolName": "octagon-agent",
  "arguments": {
    "prompt": "Retrieve year-over-year growth in key balance-sheet items for AAPL, limited to 5 records and filtered by period FY"
  }
}

Output Format

The agent returns a table with YoY growth percentages:

Data Sources: octagon-companies-agent, octagon-financials-agent

Key Observations Pattern

After receiving data, generate observations:

1. Asset base changes: Track total assets growth/decline and drivers
2. Leverage trends: Compare liabilities growth to equity growth
3. Liquidity position: Monitor cash and cash equivalents trajectory
4. Working capital: Assess inventory management efficiency
5. Capital structure shifts: Note significant equity vs liability changes

Metrics Reference

Analysis Tips

Deleveraging Signal

When Liabilities decline while Equity grows:

• Company paying down debt
• Strengthening balance sheet
• Example: Liabilities -7.31%, Equity +29.47%

Asset-Light Trend

When Assets decline but Equity grows:

• Efficient capital deployment
• Possible divestitures or write-offs
• Focus on return on assets

Cash Accumulation

When Cash grows faster than Assets:

• Building war chest for M&A or buybacks
• Conservative financial positioning
• May signal limited reinvestment opportunities

Inventory Management

When Inventories decline while Revenue grows:

• Improved supply chain efficiency
• Just-in-time inventory practices
• Better demand forecasting

Capital Structure Warning

When Liabilities grow faster than Assets:

• Increasing leverage
• Potential solvency concerns if sustained
• Review debt covenants and maturities

Follow-up Queries

Based on results, suggest deeper analysis:

• "What drove the significant shareholders' equity growth in [YEAR]?"
• "Analyze [COMPANY]'s debt maturity schedule and refinancing risk"
• "Compare [COMPANY]'s leverage ratios to industry peers"
• "Extract cash flow statement data for [TICKER] to understand cash sources"

---

Supporting file: marketplace.json

{
  "name": "balance-sheet-growth",
  "description": "Retrieve year-over-year growth in balance sheet items including Total Assets, Total Liabilities, Shareholders Equity, Cash, and Inventories for public companies.",
  "version": "1.0.0",
  "author": "OctagonAI",
  "tags": ["octagon", "balance-sheet", "yoy-growth", "assets", "liabilities", "equity", "financial-analysis", "mcp"],
  "repository": "https://github.com/OctagonAI/skills"
}

---

Supporting file: README.md

Balance Sheet Growth Skill

Retrieve year-over-year growth in Total Assets, Liabilities, Equity, Cash, and Inventories for public companies using the Octagon MCP server.

Installation

npx skills add OctagonAI/skills --skill balance-sheet-growth

<details> <summary>bun</summary>

bunx skills add OctagonAI/skills --skill balance-sheet-growth

</details> <details> <summary>pnpm</summary>

pnpm dlx skills add OctagonAI/skills --skill balance-sheet-growth

</details>

What This Skill Does

This skill retrieves balance sheet growth metrics:

• Total assets growth YoY
• Total liabilities growth
• Shareholders' equity growth
• Cash position changes
• Inventory growth trends

Example Usage

Retrieve YoY growth in Total Assets, Liabilities, Equity for TSLA

---

Octagon MCP Setup

This skill requires the Octagon MCP (https://github.com/OctagonAI/octagon-mcp) server to be configured in your AI agent.

Get Your API Key

1. Sign up at Octagon (https://app.octagonai.co/signup/?redirectToAfterSignup=https://app.octagonai.co/api-keys)
2. Navigate to API Keys from the left menu
3. Generate and save your API key

Configure Cursor

1. Open Cursor Settings → Features > MCP Servers
2. Click + Add New MCP Server
3. Enter:
   • Name: octagon-mcp
   • Type: command
   • Command: env OCTAGON_API_KEY=<your-api-key> npx -y octagon-mcp

Windows: cmd /c "set OCTAGON_API_KEY=<your-api-key> && npx -y octagon-mcp"

Configure Claude Desktop

Add to claude_desktop_config.json:

{
  "mcpServers": {
    "octagon-mcp-server": {
      "command": "npx",
      "args": ["-y", "octagon-mcp@latest"],
      "env": {
        "OCTAGON_API_KEY": "YOUR_API_KEY_HERE"
      }
    }
  }
}

Documentation

• Octagon Docs (https://docs.octagonagents.com)
• Octagon MCP GitHub (https://github.com/OctagonAI/octagon-mcp)

---

Supporting file: references/interpreting-results.md

Interpreting Balance Sheet Growth

Reading the Output

Positive values = Growth vs prior year Negative values = Decline vs prior year

Key Patterns

Deleveraging

When Liabilities Growth < 0 and Equity Growth > 0:

• Company reducing debt burden
• Strengthening financial position
• Often positive for credit ratings

Leveraging Up

When Liabilities Growth > Assets Growth:

• Taking on more debt relative to assets
• Could be strategic (low rates, M&A) or concerning
• Check purpose of debt increase

Cash Build

When Cash Growth significantly exceeds Assets Growth:

• Accumulating liquidity
• Preparing for acquisitions, buybacks, or uncertainty
• May indicate lack of reinvestment opportunities

Working Capital Efficiency

When Inventories decline while business grows:

• Better supply chain management
• Reduced carrying costs
• Improved cash conversion cycle

Balance Sheet Health Indicators

Strong Position

• Equity growth outpacing Liabilities growth
• Cash position stable or growing
• Controlled inventory levels

Warning Signs

• Liabilities growing faster than Assets for multiple years
• Cash declining while Liabilities increase
• Inventory buildup with slowing revenue

Connecting to Other Statements

Balance sheet changes connect to:

1. Income Statement: Net Income flows to Retained Earnings (Equity)
2. Cash Flow Statement: Explains Cash changes
3. Debt Schedule: Details behind Liabilities changes

Follow-up Analysis

Retrieve cash flow statement data for AAPL for the last 5 fiscal years

Analyze AAPL's debt maturity schedule and interest coverage ratio

Compare AAPL's leverage ratios (Debt/Equity, Debt/Assets) to MSFT and GOOGL

---

Supporting file: references/mcp-setup.md

Octagon MCP Setup for Cursor

Prerequisites

Install Node.js (includes npm and npx):

macOS:

brew install node

Windows: Download from https://nodejs.org/ (LTS version)

Verify:

node -v && npm -v && npx -v

Get Octagon API Key

1. Sign up at https://app.octagonai.co/signup/?redirectToAfterSignup=https://app.octagonai.co/api-keys
2. Navigate to API Keys in left menu
3. Generate and save your key

Configure Cursor

1. Open Cursor Settings
2. Go to Features > MCP Servers
3. Click + Add New MCP Server
4. Enter:
   • Name: octagon-mcp
   • Type: command
   • Command: env OCTAGON_API_KEY=<your-api-key> npx -y octagon-mcp

Windows:

cmd /c "set OCTAGON_API_KEY=<your-api-key> && npx -y octagon-mcp"

Verify

Refresh MCP server list. Test with:

Retrieve the current stock price for AAPL

Documentation

https://docs.octagonagents.com