Nanoco Group plc (NANO) AI Stock Analysis

• Market Cap: £17.74M
• Dividend Yield: N/A
• Average Volume (3M): 404.43K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.90
• Revenue Growth: -3.25%
• EPS Growth: -172.09%
• Country: UK
• Employees: 47
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): >-0.01
• Shares Outstanding: 195,543,820
• 10 Day Avg. Volume: 424,468
• 30 Day Avg. Volume: 404,433
• PEG Ratio: 0.31
• Price to Book (P/B): -2.53
• Price to Sales (P/S): 5.46
• P/FCF Ratio: 0.86
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 44 Neutral
• Price Target: 11.50p ▲(29.21% Upside)

The overall stock score of 44 reflects significant financial challenges, including a net loss and negative equity, despite strong revenue growth and cash flow management. Technical indicators show bearish trends, and valuation metrics are concerning due to a negative P/E ratio. The earnings call highlighted both opportunities and risks, with restructuring efforts and market potential being positive, but revenue decline and ongoing uncertainties weighing on the outlook.

Positive Factors

Strong IP Position

A strong intellectual property position allows Nanoco to secure licensing deals, providing a durable competitive advantage and potential revenue streams.

Successful Restructuring

Reducing cash burn enhances financial stability, allowing Nanoco to focus resources on growth initiatives and improving its cash runway.

Market Potential

The expanding quantum dot market presents significant growth opportunities for Nanoco, supporting long-term revenue potential in key sectors.

Negative Factors

Revenue Decline

A decline in revenue due to contract cancellations highlights potential vulnerabilities in customer dependency and revenue predictability.

Loss After Tax

Reporting a loss after tax indicates profitability challenges, which could impact financial health and limit reinvestment capabilities.

Negative Equity Position

Negative equity suggests financial distress, potentially limiting access to capital markets and increasing risk for stakeholders.

Nanoco Group plc Business Overview & Revenue Model

Company Description

Nanoco Group plc, together with its subsidiaries, engages in the research, development, manufacture, and licensing of novel nanomaterials for use in various commercial applications. The company offers CFQD quantum dots which are fluorescent semiconductor nanoparticles for OLED and µLED colour conversion, QD-EL, and security tagging applications; CFQD fine color films; HEATWAVE quantum dots for use in the sensor industry applications; and VIVODOTS nanoparticles for medical and veterinary applications. It has operations in the United Kingdom, rest of Europe, Asia, and the United States. The company was formerly known as Evolutec Group plc and changed its name to Nanoco Group plc in April 2009. Nanoco Group plc was founded in 2001 and is headquartered in Manchester, the United Kingdom.

How the Company Makes Money

Nanoco Group plc generates revenue primarily through the sale of its proprietary quantum dot products and nanomaterials to various industries, including consumer electronics, telecommunications, and healthcare. The company has established partnerships with major players in the display technology sector, which provides significant licensing and royalty income. Additionally, Nanoco may engage in collaborative research and development projects, creating further revenue opportunities through government grants and funding from private sector partners aimed at advancing nanotechnology applications. The company's focus on developing sustainable and environmentally friendly solutions also positions it favorably in a market increasingly concerned with sustainability.

Nanoco Group plc Financial Statement Overview

Summary

Nanoco Group plc shows strong revenue growth and excellent gross profit margins. However, the shift to a net loss and negative equity position indicates significant financial challenges. Despite robust cash flow management, the negative equity and profitability issues raise concerns about financial stability.

Income Statement

The company has demonstrated significant revenue growth from 2023 to 2024, with a revenue increase of approximately 40.1%. However, despite the revenue growth, the company has moved from a net profit in 2023 to a net loss in 2024, resulting in a negative net profit margin. The gross profit margin is strong at 84.6%, indicating efficient production or service delivery. Nonetheless, the transition to a net loss and the negative EBIT margin of 21.7% highlight profitability challenges.

Balance Sheet

The balance sheet reflects financial instability, as indicated by the negative stockholders' equity of -£17 million in 2024. This, coupled with a total debt of £1.9 million, raises concerns about the company's leverage and stability. The debt-to-equity ratio is not meaningful due to negative equity, and the equity ratio is also negative. These factors suggest financial distress, potentially posing risks to creditors and stakeholders.

Cash Flow

The cash flow statement shows a robust operating cash flow in 2024, significantly improving from previous years and resulting in a highly positive free cash flow. This indicates strong cash generation capabilities despite the net loss. The free cash flow to net income ratio is favorable, suggesting efficient cash management. However, the sustainability of this cash flow remains uncertain given the net loss scenario.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.37M	7.87M	5.62M	2.47M	2.09M	3.86M
Gross Profit	5.85M	6.66M	4.77M	1.09M	757.00K	1.78M
EBITDA	113.00K	3.58M	15.94M	-3.82M	-3.88M	-4.16M
Net Income	-4.05M	-1.25M	11.09M	-4.70M	-4.39M	-5.08M
Balance Sheet
Total Assets	25.15M	30.66M	50.77M	10.89M	9.23M	11.86M
Cash, Cash Equivalents and Short-Term Investments	15.48M	20.29M	8.21M	6.76M	3.81M	5.17M
Total Debt	1.61M	1.91M	6.43M	4.09M	4.17M	1.58M
Total Liabilities	43.76M	47.67M	34.35M	6.41M	6.18M	4.83M
Stockholders Equity	-18.61M	-17.01M	16.41M	4.48M	3.05M	7.24M
Cash Flow
Free Cash Flow	-3.96M	49.88M	-28.22M	-1.90M	-3.75M	-4.24M
Operating Cash Flow	-3.33M	51.48M	-27.84M	-1.78M	-3.36M	-3.53M
Investing Cash Flow	-752.00K	-816.00K	34.18M	-82.00K	-344.00K	-704.00K
Financing Cash Flow	-39.93M	-38.92M	-5.08M	4.79M	2.32M	2.40M

Nanoco Group plc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 8.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:NANO, the sentiment is Negative. The current price of 8.9 is below the 20-day moving average (MA) of 9.58, below the 50-day MA of 9.82, and below the 200-day MA of 10.49, indicating a bearish trend. The MACD of -0.21 indicates Positive momentum. The RSI at 35.43 is Neutral, neither overbought nor oversold. The STOCH value of 24.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:NANO.

Nanoco Group plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OXIG	73 Outperform	$1.04B	40.82	4.64%	1.14%	-5.39%	-73.52%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
CRTA	50 Neutral	£24.83M	―	-268.88%	―	1.65%	29.02%
NANO	44 Neutral	£17.74M	-6.51	―	―	-3.25%	-172.09%
IQE	42 Neutral	£54.35M	-1.08	-37.55%	―	-24.75%	-110.79%
GST	41 Neutral	£19.76M	-10.63	-29.86%	―	88.59%	-60.00%

Nanoco Group plc Corporate Events

Nanoco Group Expands Asian Partnerships with New Joint Development Agreement

Nanoco Group plc has entered a Joint Development Agreement with a second Asian chemical customer to optimize lead-free nanomaterials for electronics. This agreement is expected to boost the company’s revenue in FY25 and FY26 and strengthen its position in the consumer electronics market, particularly in quantum dot-enabled silicon sensors.