Cyanotech (CYAN) AI Stock Analysis

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Cyanotech

(OTC:CYAN)

Rating:41Neutral

Price Target:

$0.50

▲(66.67% Upside)

Cyanotech's overall stock score is primarily impacted by its poor financial performance, characterized by declining revenue, negative margins, and high leverage. The technical analysis further indicates bearish momentum, with the stock trading below key moving averages. Valuation metrics are also weak, with a negative P/E ratio and no dividend yield. These factors collectively result in a low overall stock score.

Cyanotech (CYAN) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$2.21M

Dividend YieldN/A

Average Volume (3M)5.59K

Price to Earnings (P/E)―

Beta (1Y)-0.52

Revenue Growth1.32%

EPS Growth45.45%

CountryUS

Employees77

SectorConsumer Defensive

Sector Strength53

IndustryPackaged Foods

Share Statistics

EPS (TTM)-0.13

Shares Outstanding7,242,243

10 Day Avg. Volume6,974

30 Day Avg. Volume5,593

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap6.32

Enterprise Value/Revenue0.58

Enterprise Value/Gross Profit1.94

Enterprise Value/Ebitda-39.60

Forecast

1Y Price Target

$0.50

Price Target Upside66.67% Upside

Rating ConsensusHold

Number of Analyst Covering1

Cyanotech Business Overview & Revenue Model

Company DescriptionCyanotech Corporation is a biotechnology company based in Hawaii that specializes in the cultivation and production of microalgae-based products. Founded in 1983, the company operates primarily in the health and wellness sector, focusing on the extraction of high-value bioactive compounds such as astaxanthin and spirulina. Cyanotech's core products include nutritional supplements and functional food ingredients that cater to health-conscious consumers and the dietary supplement industry.

How the Company Makes MoneyCyanotech generates revenue through the sale of its microalgae-derived products, primarily astaxanthin and spirulina, which are marketed as dietary supplements and functional food ingredients. The company has a diversified revenue model that includes direct-to-consumer sales, partnerships with health and wellness brands, and distribution agreements with retailers both domestically and internationally. Significant revenue streams come from bulk sales of its products to manufacturers who incorporate these ingredients into their own supplement formulations. Additionally, Cyanotech benefits from strategic partnerships that enhance its market reach and product development capabilities, contributing to its overall earnings.

Cyanotech Earnings Call Summary

Earnings Call Date:Aug 06, 2025

(Q2-2025)

% Change Since: -23.08%|

Next Earnings Date:Nov 05, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed picture with notable growth in contract extraction revenue and improved inventory and capital metrics. However, significant declines in net sales, gross profit margin, and an increased net loss, largely due to inventory challenges, highlight ongoing challenges.

Q2-2025 Updates

Positive Updates

Increase in Work-in-progress Inventory

Mid-quarter financing allowed Cyanotech to increase work in progress inventory by $1.9 million, despite a decrease in finished goods inventory.

Significant Growth in Contract Extraction Revenue

Revenue from contract extraction grew by 156%, reflecting a strong demand in this segment.

Increase in Cash and Working Capital

Cash increased to $780,000 and working capital increased to $550,000, up from $720,000 and $200,000 respectively as of June 30, 2024.

Negative Updates

Decrease in Total Net Sales

Total net sales for the second quarter of fiscal 2025 were $5.8 million, down from $6.4 million in the same quarter of fiscal 2024, marking a decrease of $528,000 or 8.3%.

Decline in Gross Profit and Margin

Gross profit fell to $1.48 million with a margin of 25.3%, compared to $2 million and 32.8% in the prior year, primarily due to a higher percentage of lower-margin bulk sales.

Increased Operating and Net Loss

Operating loss increased to $975,000 from $632,000, and net loss increased to $1.15 million or $0.16 per diluted share from $0.8 million or $0.13 per diluted share.

Decrease in Packaged Goods Sales

Packaged goods sales declined by 21% due to stock shortages and timing issues, contributing to an overall 8% drop in total sales for the quarter.

Company Guidance

In the earnings call for Cyanotech's Q2 2025, management highlighted several key metrics and provided guidance on future performance. Despite a 39% increase in bulk inventory sales and a 156% rise in contract extraction revenue, overall sales for the quarter dropped by 8% due to a 21% decline in packaged goods sales caused by stock shortages. For the first half of the year, sales were up by 2%. Total net sales for the quarter were $5.8 million, down from $6.4 million in Q2 2024, with a gross profit margin declining from 32.8% to 25.3%, driven by a higher sales mix of lower-margin bulk products. Operating loss increased to $975,000 from $632,000 in the previous year, and net loss was $1.15 million or $0.16 per diluted share, compared to $0.8 million or $0.13 per share in Q2 2024. The company reported cash reserves of $780,000 and an improved working capital of $550,000, attributed to higher inventories and a short-term debt reclassification. Management is focused on addressing inventory challenges to improve the sales mix and maintain strong sales in their algae-based products.

Cyanotech Financial Statement Overview

Summary

Cyanotech is experiencing significant financial difficulties, with declining revenue, negative profitability, and increasing leverage. The company's cash flow issues further exacerbate its financial health, requiring strategic intervention to stabilize operations and improve cash management.

Income Statement

Negative

Cyanotech's income statement reveals significant challenges, with declining revenue since 2022 and persistent negative net income for the past three years. Gross profit margin improved slightly in 2025 to 28.40% from 25.77% in 2024, but the company continues to struggle with negative EBIT and EBITDA margins, indicating operational inefficiencies. The net profit margin also remains negative, highlighting ongoing profitability issues.

Balance Sheet

Negative

The balance sheet shows moderate stability, with a debt-to-equity ratio of 1.30 in 2025, up from 0.92 in 2022, suggesting increasing leverage. Return on equity is negative due to persistent net losses. The equity ratio decreased over the years to 37.81% in 2025, indicating a reduced equity base relative to total assets, which may heighten financial risk.

Cash Flow

Negative

Cyanotech's cash flow statement highlights cash flow challenges, with negative operating and free cash flows in 2025. The free cash flow to net income ratio is negative, signaling insufficient cash flow generation relative to net losses. The company has not achieved positive free cash flow growth, reflecting poor cash management and financial distress.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.14M	24.21M	23.07M	23.18M	35.97M	32.34M
Gross Profit	7.17M	6.88M	5.95M	7.26M	13.57M	11.12M
EBITDA	-352.00K	-629.00K	-2.51M	-825.00K	4.50M	3.54M
Net Income	-2.93M	-3.20M	-5.27M	-3.44M	2.15M	920.00K
Balance Sheet
Total Assets	23.00M	23.49M	25.11M	29.73M	32.05M	30.88M
Cash, Cash Equivalents and Short-Term Investments	383.00K	257.00K	707.00K	974.00K	2.59M	3.77M
Total Debt	11.91M	11.56M	10.90M	11.17M	8.61M	10.55M
Total Liabilities	14.99M	14.61M	13.30M	13.38M	12.56M	13.84M
Stockholders Equity	8.00M	8.88M	11.81M	16.35M	19.49M	17.04M
Cash Flow
Free Cash Flow	-1.88M	-1.44M	-836.00K	-3.17M	1.11M	1.64M
Operating Cash Flow	-1.76M	-1.19M	-455.00K	-2.10M	2.38M	2.40M
Investing Cash Flow	-222.00K	-247.00K	-381.00K	-1.07M	-1.27M	-760.00K
Financing Cash Flow	1.65M	990.00K	569.00K	1.55M	-2.29M	-290.00K

Cyanotech Technical Analysis

Technical Analysis Sentiment

Negative

Last Price0.30

Price Trends

50DMA

0.38

Negative

100DMA

0.37

Negative

200DMA

0.38

Negative

Market Momentum

MACD

-0.02

Positive

RSI

44.03

Neutral

STOCH

45.45

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CYAN, the sentiment is Negative. The current price of 0.3 is below the 20-day moving average (MA) of 0.35, below the 50-day MA of 0.38, and below the 200-day MA of 0.38, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 44.03 is Neutral, neither overbought nor oversold. The STOCH value of 45.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CYAN.

Cyanotech Risk Analysis

Cyanotech disclosed 31 risk factors in its most recent earnings report. Cyanotech reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Cyanotech Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NATR	80 Outperform	$293.46M	21.99	9.15%	―	4.33%	-6.33%
WYHG	72 Outperform	$40.92M	4.92	9.79%	―	―	―
Sector *	63 Neutral	$20.84B	14.73	-4.08%	3.07%	2.70%	-8.60%
STKL	59 Neutral	$729.21M	―	-1.34%	―	10.90%	96.02%
NAII	53 Neutral	$24.59M	―	-10.25%	―	-1.16%	-146.23%
LSF	42 Neutral	$63.45M	―	-8.34%	―	22.79%	74.00%
CYAN	41 Neutral	$2.21M	―	-31.37%	―	1.32%	45.45%

* Consumer Defensive Sector Average

Performance Comparison

CYAN

Cyanotech

0.32

-0.32

-50.00%

NAII

Natural Alternatives International

3.98

-1.48

-27.11%

NATR

Nature's Sunshine Products

16.40

2.82

20.77%

STKL

SunOpta

6.46

0.25

4.03%

LSF

Laird Superfood

5.95

1.82

44.07%

WYHG

Wing Yip Food Holdings Group Limited Sponsored ADR

1.57

-2.47

-61.14%

Cyanotech Corporate Events

Executive/Board ChangesPrivate Placements and FinancingBusiness Operations and Strategy

Cyanotech Amends Promissory Note with Skywords

Positive

May 8, 2025

On May 2, 2025, Cyanotech Corporation amended its promissory note with Skywords Family Foundation, allowing the company to pay interest in common stock for the fiscal year ending March 31, 2026. This amendment reflects strategic financial management, as Skywords is controlled by Cyanotech’s Chairman, Michael Davis. Additionally, effective June 16, 2025, Cyanotech renewed the Executive Employment Agreement with CEO Matthew K. Custer, offering a structured compensation package including stock options and a signing bonus contingent on financial performance, indicating a commitment to leadership stability and potential growth.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 20, 2025