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Loop Industries Inc (LOOP)
NASDAQ:LOOP
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Loop Industries
(NASDAQ:LOOP)
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Rating:47Neutral
Price Target:
$1.00
▼(-1.96% Downside)
Loop Industries faces significant financial challenges, with negative equity and profitability issues being the most critical factors. However, recent corporate agreements offer potential for future growth. Technical indicators suggest bearish momentum, and valuation metrics highlight ongoing financial struggles.
Positive Factors
Revenue Growth
Strong revenue growth suggests increasing demand for Loop's sustainable solutions, supporting long-term business expansion and market penetration.
Strategic Partnerships
This partnership enhances Loop's market reach and revenue potential by securing a stable demand for its products, fostering long-term growth.
Joint Venture in Europe
The joint venture expands Loop's footprint in Europe, leveraging local expertise and resources to boost operational capacity and market presence.
Negative Factors
Negative Equity
Negative equity reflects financial instability, limiting Loop's ability to finance growth and increasing vulnerability to economic downturns.
Profitability Challenges
Ongoing profitability issues hinder Loop's ability to reinvest in its business, potentially affecting its competitive position and long-term viability.
Negative Free Cash Flow
Negative free cash flow limits Loop's financial flexibility, constraining its ability to fund new projects and manage debt sustainably.
Loop Industries (LOOP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$48.76M
Dividend YieldN/A
Average Volume (3M)133.63K
Price to Earnings (P/E)―
Beta (1Y)1.16
Revenue Growth11013.00%
EPS Growth39.85%
CountryUS
Employees50
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)-0.07
Shares Outstanding48,043,068
10 Day Avg. Volume164,814
30 Day Avg. Volume133,635
Financial Highlights & Ratios
PEG Ratio0.15
Price to Book (P/B)172.45
Price to Sales (P/S)5.81
P/FCF Ratio-24.62
Enterprise Value/Market Cap1.61
Enterprise Value/Revenue7.05
Enterprise Value/Gross Profit7.35
Enterprise Value/Ebitda-7.87
Forecast
1Y Price Target
$4.55Price Target Upside346.08% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Loop Industries Business Overview & Revenue Model
Company DescriptionLoop Industries, Inc., a technology company, focuses on depolymerizing waste polyethylene terephthalate (PET) plastics and polyester fibers into base building blocks. It polymerized monomers into virgin-quality PET resins for use in food-grade plastic packaging, such as plastic bottles for water and carbonated soft drinks, and containers for food and other consumer products; and polyester fibers, including textiles, clothing, and apparel. The company was incorporated in 2010 and is based in Terrebonne, Canada.
How the Company Makes MoneyLoop Industries generates revenue through the licensing of its proprietary technology to partners in the plastics and recycling industries, enabling them to produce sustainable PET products. The company also earns income from the sale of its depolymerized PET materials to manufacturers seeking sustainable raw materials for their products. Key revenue streams include licensing fees, sales of recycled PET, and potential joint ventures with strategic partners who are looking to integrate Loop's technology into their operations. Additionally, Loop has formed significant partnerships with major corporations in the consumer goods and packaging sectors, which enhances its market presence and drives revenue growth by facilitating the adoption of its sustainable materials.
Loop Industries Earnings Call Summary
Earnings Call Date:Jul 15, 2025
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jan 08, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted significant progress in strategic projects and cost management, with strong partnerships and financial discipline. However, there are challenges related to contract execution delays and a funding gap, which may impact project timelines.Q1-2026 Updates
Positive Updates
Significant Progress in Infinite Loop Manufacturing
Loop Industries is making steady progress towards the groundbreaking of Infinite Loop manufacturing facilities in both India and Europe, with strong alignment with local JV partners.
Cost Reduction in Manufacturing
The modularization strategy is expected to reduce CapEx by 50% for future projects, bringing significant savings and competitive pricing.
Financial Discipline and Cash Management
Cash operating expenses were reduced by $2.2 million or 46% compared to the same quarter last year, maintaining a disciplined approach to managing expenses.
Partnership with European Beverage Brands
Loop is in advanced discussions with European beverage brands for high-quality recycled PET, offering a competitive advantage due to superior quality and low-cost structure.
Strong Cash Position
Loop Industries ended the quarter with available liquidity of $12.3 million, positioning them well for future investments.
Negative Updates
Delayed Contract Execution
The signing of customer contracts is taking longer than expected due to internal processes and inflation concerns, impacting project timelines.
Dependency on Customer Contracts for Financing
The execution of customer contracts is critical for securing debt financing for the India project, which presents a dependency risk.
Significant Funding Gap
There is a $15 million funding gap for the India project, requiring Loop to explore multiple financing opportunities.
Potential Delays in Facility Completion
Concerns about potential delays in completing the facility by the end of 2027, which could impact customer agreements.
Company Guidance
During the Loop Industries First Quarter Fiscal 2026 Corporate Update Call, significant guidance was provided regarding their strategic projects and financial metrics. The company is advancing the development of Infinite Loop manufacturing facilities in India and Europe, with a confirmed CapEx of $176 million for the Indian facility, which includes a polymerization unit and other costs. The technology's core cost is $95 million, and they boast a highly competitive CapEx of $0.61 per pound of PET resin. They reported a reduction in cash operating expenses to $2.6 million, a 46% decrease from the previous year, and ended the quarter with $12.3 million in liquidity. The company's focus is on securing off-take agreements with major apparel and CPG brands, emphasizing their virgin-quality recycled PET. The anticipated equity contribution for the Indian facility is $25 million, with a funding gap of $15 million expected to be addressed through various means, including government funding and engineering revenues. The company's modularization strategy aims to reduce future CapEx by 50%, enhancing their competitive edge.Loop Industries Financial Statement Overview
Summary
Loop Industries shows positive revenue growth but faces significant profitability and leverage challenges. Negative equity and free cash flow highlight financial risks, though improvements in revenue and operating cash flow offer some optimism.Income Statement
The income statement shows a significant improvement in total revenue from previous periods, indicating positive revenue growth. However, the company is still experiencing substantial negative EBIT and net income, resulting in negative profit margins, which highlights ongoing profitability challenges.Balance Sheet
The balance sheet indicates high leverage with negative stockholders' equity, leading to a negative equity ratio. The debt-to-equity ratio is concerning due to negative equity, and the company's financial stability is at risk with liabilities exceeding assets.Cash Flow
Cash flow analysis reveals a moderate improvement in operating cash flow relative to net income, suggesting better cash management. However, free cash flow remains negative, indicating continued challenges in generating sufficient cash from operations to cover capital expenditures.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 11.11M | 10.89M | 153.00K | 172.84K | 0.00 | 0.00 |
| Gross Profit | 10.66M | 10.37M | -382.00K | -377.28K | -548.23K | -775.67K |
| EBITDA | -9.95M | -13.91M | -20.36M | -20.56M | -44.22M | -35.49M |
| Net Income | -11.68M | -15.06M | -21.09M | -21.30M | -44.92M | -36.34M |
Balance Sheet | ||||||
| Total Assets | 13.29M | 18.58M | 20.55M | 40.56M | 59.22M | 43.40M |
| Cash, Cash Equivalents and Short-Term Investments | 7.31M | 12.97M | 6.96M | 29.59M | 44.06M | 35.22M |
| Total Debt | 464.00K | 3.08M | 3.32M | 3.30M | 3.38M | 2.45M |
| Total Liabilities | 18.76M | 18.21M | 6.41M | 6.82M | 13.23M | 10.58M |
| Stockholders Equity | -5.47M | 367.00K | 14.14M | 33.74M | 45.99M | 32.82M |
Cash Flow | ||||||
| Free Cash Flow | -625.00K | -2.57M | -23.68M | -35.93M | -48.10M | -24.82M |
| Operating Cash Flow | -950.00K | -2.12M | -18.03M | -34.89M | -42.98M | -22.49M |
| Investing Cash Flow | -1.84M | -2.04M | -5.64M | 21.28M | -5.11M | -2.98M |
| Financing Cash Flow | 8.83M | 10.32M | -75.00K | 1.01M | 56.99M | 26.60M |
Loop Industries Technical Analysis
Negative
1.02
Price Trends
1.21
Negative
1.43
Negative
1.35
Negative
Market Momentum
-0.05
Negative
46.13
Neutral
86.43
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOOP, the sentiment is Negative. The current price of 1.02 is above the 20-day moving average (MA) of 1.00, below the 50-day MA of 1.21, and below the 200-day MA of 1.35, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 46.13 is Neutral, neither overbought nor oversold. The STOCH value of 86.43 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LOOP.
Loop Industries Risk Analysis
Loop Industries disclosed 28 risk factors in its most recent earnings report. Loop Industries 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
Loop Industries Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
61 Neutral | $86.44M | 46.84 | 5.08% | ― | 0.18% | -54.25% | |
56 Neutral | $717.90M | -3.51 | -22.21% | ― | -12.07% | -821.68% | |
55 Neutral | $499.16M | -10.71 | -9.27% | ― | 675.75% | 42.00% | |
50 Neutral | $76.98M | 4,511.11 | 0.02% | 1.33% | -0.97% | -99.67% | |
47 Neutral | $48.76M | -4.14 | ― | ― | 11013.00% | 39.85% |
* Basic Materials Sector Average
LOOP
Loop Industries
1.02
-0.29
-22.14%
FSI
Flexible Solutions International
6.81
3.19
88.12%
GEVO
Gevo
2.06
-0.65
-23.99%
GPRE
Green Plains
10.28
0.24
2.39%
NTIC
Northern Technologies International
8.12
-5.02
-38.20%
CNEY
CN Energy Group
0.63
-8.40
-93.02%
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.