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Zotefoams PLC (GB:ZTF)
LSE:ZTF

Zotefoams (ZTF) AI Stock Analysis

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GB

Zotefoams

(LSE:ZTF)

Rating:64Neutral
Price Target:
337.00p
▲(4.98%Upside)
Zotefoams' stock is buoyed by strong technical momentum and a robust cash flow position, but faces challenges due to profitability issues and a negative P/E ratio. Strategic initiatives and shareholder confidence provide a positive outlook, suggesting potential for growth despite current valuation concerns.

Zotefoams (ZTF) vs. iShares MSCI United Kingdom ETF (EWC)

Zotefoams Business Overview & Revenue Model

Company DescriptionZotefoams plc, together with its subsidiaries, manufactures, distributes, and sells polyolefin block foams in the United Kingdom, Continental Europe, North America, and internationally. The company operates through Polyolefin Foams, High-Performance Products, and MuCell Extrusion LLC segments. It offers AZOTE, a polyolefin foam under the Plastazote, Evazote, and Supazote brands; and various high-performance foams manufactured from fluoropolymers, engineering polymers, and specialty elastomers under the ZOTEK brand. The company also provides T-FIT, a clean insulation system that is used in the pharmaceutical, biotech, and semiconductor cleanroom industries. In addition, it owns and licenses patented MuCell microcellular foam technology, as well as sells related machinery. The company primarily serves the automotive, aerospace, product protection, industrial parts, marine, building and construction, military, and sports and leisure industries. Zotefoams plc was founded in 1921 and is headquartered in Croydon, the United Kingdom.
How the Company Makes MoneyZotefoams generates revenue primarily through the manufacture and sale of its specialized foam products. The company's revenue streams are largely driven by its diverse product offerings, each tailored to meet specific industry needs. Key revenue sources include the sale of polyolefin foams, which are used extensively in packaging, construction, and industrial applications; high-performance polymer foams, targeted at markets requiring superior thermal and acoustic insulation properties; and microcellular foams, which provide enhanced material performance in lightweight and high-strength applications. Additionally, Zotefoams benefits from strategic partnerships and collaborations with global industry leaders, which facilitate market expansion and innovation in product development. The company's earnings are further supported by its focus on sustainability and efficiency, leveraging its proprietary technologies to deliver cost-effective and environmentally friendly solutions.

Zotefoams Financial Statement Overview

Summary
Zotefoams is experiencing revenue growth but faces profitability challenges with a declining EBIT and a net loss. The balance sheet is strong, although increasing debt levels could pose risks. Cash flow performance is robust, showing strong operational cash generation and improved free cash flow.
Income Statement
55
Neutral
The recent annual report shows a decline in profitability with a negative net income, resulting in a negative net profit margin. However, the company has demonstrated revenue growth of 16.39% from the previous year, indicating a positive trajectory in sales. Gross profit margin is stable, but EBIT and EBITDA margins have decreased, reflecting pressure on operational efficiency.
Balance Sheet
65
Positive
The balance sheet remains strong with a healthy equity ratio of 62.56%, indicating a solid capital structure. However, the debt-to-equity ratio has increased slightly to 0.40, suggesting a rise in leverage. Return on equity has turned negative due to the net loss, which is a concern for profitability.
Cash Flow
70
Positive
Cash flow from operations has significantly improved, supporting a positive free cash flow. The free cash flow to net income ratio is unfavorable due to the negative net income, but the operating cash flow to net income ratio indicates operational cash generation capability. The free cash flow growth rate is strong, reflecting improved cash management.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue147.79M126.97M127.37M100.75M82.65M
Gross Profit46.13M41.05M38.73M26.57M27.78M
EBITDA12.28M23.41M22.16M15.67M15.72M
Net Income-2.75M9.24M10.01M4.38M7.16M
Balance Sheet
Total Assets174.75M175.61M170.36M159.38M158.22M
Cash, Cash Equivalents and Short-Term Investments10.53M6.29M10.59M8.05M8.50M
Total Debt43.56M37.86M38.41M42.40M44.10M
Total Liabilities65.39M59.85M60.82M61.60M63.85M
Stockholders Equity109.36M115.76M109.54M97.78M94.38M
Cash Flow
Free Cash Flow11.35M-702.00K14.03M3.83M-1.85M
Operating Cash Flow25.00M7.78M21.12M10.90M10.86M
Investing Cash Flow-13.34M-8.29M-7.09M-6.98M-12.71M
Financing Cash Flow-7.41M-3.73M-11.53M-4.34M3.72M

Zotefoams Technical Analysis

Technical Analysis Sentiment
Positive
Last Price321.00
Price Trends
50DMA
283.31
Positive
100DMA
277.10
Positive
200DMA
312.58
Positive
Market Momentum
MACD
8.49
Positive
RSI
63.93
Neutral
STOCH
76.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:ZTF, the sentiment is Positive. The current price of 321 is above the 20-day moving average (MA) of 312.75, above the 50-day MA of 283.31, and above the 200-day MA of 312.58, indicating a bullish trend. The MACD of 8.49 indicates Positive momentum. The RSI at 63.93 is Neutral, neither overbought nor oversold. The STOCH value of 76.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:ZTF.

Zotefoams Peers Comparison

Overall Rating
UnderperformOutperform
Sector (43)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
GBVCT
70
Outperform
£690.59M23.256.65%7.50%4.75%-3.29%
68
Neutral
£2.95B8.3115.96%4.64%-15.51%200.70%
67
Neutral
£312.16M26.574.26%2.11%-4.39%33.44%
GBZTF
64
Neutral
£162.95M14.46-2.45%1.13%16.39%-129.71%
GBELM
62
Neutral
£965.30M-5.93%1.53%0.71%-274.39%
50
Neutral
£181.88M-6.25%0.81%15.63%
43
Neutral
AU$1.38B-6.07-40.62%4.17%-4.78%-42.91%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:ZTF
Zotefoams
321.00
-134.87
-29.59%
GB:ELM
Elementis
160.00
20.38
14.60%
GB:ESNT
Essentra
107.00
-49.88
-31.80%
GB:JMAT
Johnson Matthey
1,736.00
232.06
15.43%
GB:SYNT
Synthomer
109.40
-160.10
-59.41%
GB:VCT
Victrex
776.00
-299.58
-27.85%

Zotefoams Corporate Events

Other
Zotefoams Directors Acquire Shares Under Incentive Plan
Neutral
Jun 12, 2025

Zotefoams plc announced that directors and persons discharging managerial responsibilities have acquired shares under the company’s Share Incentive Plan. This transaction, involving the purchase of partnership shares and allocation of matching shares, reflects the company’s commitment to aligning management interests with shareholder value, potentially impacting its market positioning and stakeholder confidence.

DividendsBusiness Operations and Strategy
Zotefoams Directors Acquire Shares Under Incentive Plan
Neutral
Jun 10, 2025

Zotefoams plc announced that its directors and persons discharging managerial responsibilities have acquired ordinary shares under the company’s Share Incentive Plan. This transaction, involving the purchase of dividend shares, reflects the company’s ongoing commitment to align the interests of its leadership with those of its shareholders, potentially impacting its market positioning and stakeholder confidence.

Shareholder MeetingsBusiness Operations and Strategy
Zotefoams Successfully Passes All Resolutions at 2025 AGM
Positive
May 22, 2025

At its 2025 Annual General Meeting, Zotefoams plc successfully passed all resolutions, including ordinary and special resolutions, with a shareholder voting turnout of 53.51%. The approval of these resolutions, including the re-election of directors and authorization of share allotments, reflects strong shareholder support and positions the company for continued strategic growth and operational efficiency.

Business Operations and StrategyFinancial Disclosures
Zotefoams Reports Strong Growth and Strategic Progress in 2025
Positive
May 22, 2025

Zotefoams has reported a strong trading performance for the first four months of 2025, achieving an 8% sales growth and record revenue of £50.7 million. The company is executing a refreshed strategy, including restructuring its commercial function and expanding its manufacturing footprint in Vietnam, which is strategically important due to the concentration of the global athletic footwear market in Asia. Despite potential challenges from US tariffs, Zotefoams remains confident in its growth prospects, supported by robust margins, a growing order book, and strategic investments in North America and Asia.

Other
Zotefoams Directors Acquire Shares Under Incentive Plan
Positive
May 13, 2025

Zotefoams plc announced that its directors and persons discharging managerial responsibilities have acquired shares under the company’s Share Incentive Plan. This acquisition, involving the purchase of partnership shares and allocation of matching shares, reflects the company’s commitment to aligning management interests with shareholder value, potentially strengthening its market position and stakeholder confidence.

Executive/Board ChangesRegulatory Filings and Compliance
Zotefoams CFO Exercises Share Options Under Bonus Plan
Neutral
May 1, 2025

Zotefoams plc announced the exercise of nil cost options by Group CFO Gary McGrath under the Deferred Bonus Share Plan, involving 2,125 ordinary shares at a price of £2.53 each. This transaction, reflecting dividends during the restricted period, aligns with the UK Market Abuse Regulation, potentially impacting shareholder value and executive compensation strategies.

Executive/Board ChangesBusiness Operations and Strategy
Zotefoams Appoints New Group CFO to Drive Strategic Growth
Positive
Apr 30, 2025

Zotefoams plc announced the appointment of Nick Wright as the new Group Chief Financial Officer, effective by October 2025, succeeding Gary McGrath. Nick Wright brings over 20 years of experience in financial management and transformation, which aligns with Zotefoams’ strategic growth ambitions. His expertise in the manufacturing sector and listed company transformation will support Zotefoams’ next phase of growth, as expressed by Group CEO Ronan Cox.

Executive/Board ChangesBusiness Operations and Strategy
Zotefoams Grants Share Awards to Executive Directors
Neutral
Apr 24, 2025

Zotefoams plc announced the granting of share awards to its Executive Directors and Persons Discharging Managerial Responsibilities under the Long Term Incentive Plan 2017 and the Deferred Bonus Share Plan 2017. The awards, which include performance and restricted shares, are subject to vesting and holding periods, aligning with the company’s strategic goals and regulatory requirements. This move is part of Zotefoams’ efforts to incentivize key personnel and align their interests with the company’s long-term performance, potentially impacting its market positioning and stakeholder engagement.

Shareholder MeetingsFinancial Disclosures
Zotefoams Releases 2024 Annual Report and Announces 2025 AGM
Neutral
Apr 22, 2025

Zotefoams plc has released its 2024 Annual Report and announced the 2025 Annual General Meeting. The report, prepared in compliance with UK-adopted international accounting standards, includes financial statements, a review of business performance, and details of principal risks and uncertainties. The announcement underscores Zotefoams’ commitment to transparency and provides stakeholders with a comprehensive view of the company’s financial health and strategic direction.

Private Placements and FinancingBusiness Operations and Strategy
Zotefoams Announces Conditional Issuance of New Shares
Neutral
Apr 15, 2025

Zotefoams plc has announced the conditional issuance of 400,000 new ordinary shares to its Employee Benefit Trust to support future share incentive schemes. This move, pending approval, will result in the company having a total of 49,246,234 ordinary shares in issue, impacting the voting rights calculations for shareholders. Admission of these shares to the London Stock Exchange is expected on April 22, 2025, marking a strategic step in enhancing employee engagement and aligning with shareholder interests.

Regulatory Filings and Compliance
Zotefoams Directors Acquire Shares Under Incentive Plan
Neutral
Apr 14, 2025

Zotefoams plc announced that directors and persons discharging managerial responsibilities have acquired shares under the company’s Share Incentive Plan. The shares were purchased at £2.504 each, with additional matching shares allocated at no cost. This move aligns with regulatory requirements and reflects the company’s commitment to aligning management interests with shareholder value.

Regulatory Filings and Compliance
Zotefoams Directors Acquire Shares in Compliance with Market Regulations
Neutral
Apr 11, 2025

Zotefoams plc announced that its directors and persons discharging managerial responsibilities (PDMRs) have acquired ordinary shares in the company. The transactions, which took place on April 9 and 10, 2025, involved the Group CFO, G C McGrath, acquiring 15,948 shares at £2.3200 per share, and the Group CEO, R M Cox, acquiring 8,008 shares at £2.4972 per share. This announcement is in compliance with the UK Market Abuse Regulation, reflecting the company’s commitment to transparency and regulatory adherence.

Business Operations and StrategyRegulatory Filings and Compliance
Zotefoams PLC Announces Change in Major Holdings by BlackRock
Neutral
Apr 9, 2025

Zotefoams PLC has announced a change in its major holdings, with BlackRock, Inc. adjusting its voting rights to below 5%. This shift in shareholding could influence Zotefoams’ strategic decisions and stakeholder dynamics, reflecting BlackRock’s investment strategy and potentially impacting the company’s market positioning.

Executive/Board ChangesBusiness Operations and Strategy
Zotefoams Director Joins PUMA AIM VCT Board
Neutral
Apr 2, 2025

Zotefoams announced that Lynn Drummond, its Non-Executive Director and Chair, has been appointed as a Non-Executive Director of PUMA AIM VCT plc, which was listed on the London Stock Exchange’s main market. This move is part of the company’s ongoing strategic positioning within the industry and may influence its governance and market perception.

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: Jun 24, 2025