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Loop Industries Inc (LOOP)
NASDAQ:LOOP
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Loop Industries (LOOP) AI Stock Analysis

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LOOP

Loop Industries

(NASDAQ:LOOP)

Rating:54Neutral
Price Target:
$1.50
▼(-19.35% Downside)
Loop Industries' overall score reflects significant financial challenges, including negative equity and profitability issues, despite positive revenue growth. Technical indicators show a positive trend, while strategic initiatives and partnerships provide optimism. However, valuation concerns and project execution risks weigh on the score.

Loop Industries (LOOP) vs. SPDR S&P 500 ETF (SPY)

Loop Industries Business Overview & Revenue Model

Company DescriptionLoop Industries, Inc. is a sustainable technology company focused on developing innovative solutions for recycling polyester and producing high-quality, sustainable PET (polyethylene terephthalate) plastic. Operating in the environmental sustainability sector, Loop Industries aims to reduce plastic waste and reliance on virgin fossil fuels by utilizing its proprietary technology to transform waste PET and other types of plastics into high-purity recycled PET. The company primarily serves the consumer goods, packaging, and textile industries, offering sustainable alternatives to traditional plastic products.
How the Company Makes MoneyLoop Industries generates revenue primarily through the licensing of its advanced recycling technology and the sale of high-quality recycled PET resin. The company partners with manufacturers and brands in various sectors, allowing them to use Loop's patented processes to produce sustainable products. Key revenue streams include agreements with consumer product companies that require sustainable packaging solutions, collaborations with textile manufacturers seeking recycled fibers, and potential joint ventures that enhance their recycling capabilities. Additionally, Loop's strategic partnerships with major industry players contribute to its earnings by expanding its market reach and facilitating the adoption of its technology across different sectors.

Loop Industries Earnings Call Summary

Earnings Call Date:Jul 15, 2025
(Q1-2026)
|
% Change Since: |
Next Earnings Date:Oct 08, 2025
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 is facing significant financial challenges, with consistent profitability issues and a high leverage risk on the balance sheet. Despite growth in revenue, negative net income and cash flow concerns are prevalent. Improving cost management and revenue growth are crucial for future stability.
Income Statement
35
Negative
Loop Industries shows a significant increase in revenue from the previous years, indicating growth potential. However, persistent negative net income and EBIT margin indicate ongoing profitability challenges. The recent improvement in gross profit margin is a positive sign, but the company remains unprofitable.
Balance Sheet
40
Negative
The company's balance sheet shows a high debt-to-equity ratio due to low equity levels, posing financial risk. A decreasing equity ratio indicates potential financial instability. However, the company maintains a reasonable level of cash and short-term investments relative to its debt obligations, which is a positive factor.
Cash Flow
30
Negative
Despite a reduction in negative free cash flow, Loop Industries continues to experience cash flow challenges, highlighted by negative operating cash flow. The high operating cash flow to net income ratio indicates some efficiency in converting revenue to operating cash, but overall cash flow remains a concern.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue10.89M153.00K172.84K0.000.00
Gross Profit10.37M153.00K-377.28K-548.23K-775.67K
EBITDA-13.91M-20.36M-20.56M-44.22M-30.23M
Net Income-15.06M-21.09M-42.41M-45.07M-36.46M
Balance Sheet
Total Assets18.58M20.55M40.56M59.22M43.40M
Cash, Cash Equivalents and Short-Term Investments12.97M6.96M29.59M44.06M35.22M
Total Debt3.08M3.32M3.30M3.38M2.45M
Total Liabilities18.21M6.41M6.82M13.23M10.58M
Stockholders Equity367.00K14.14M33.74M45.99M32.82M
Cash Flow
Free Cash Flow-2.57M-23.68M-35.93M-48.10M-24.82M
Operating Cash Flow-2.12M-18.03M-34.89M-42.98M-22.49M
Investing Cash Flow-2.04M-5.64M21.28M-5.11M-2.98M
Financing Cash Flow10.32M-75.00K1.01M56.99M26.60M

Loop Industries Technical Analysis

Technical Analysis Sentiment
Positive
Last Price1.86
Price Trends
50DMA
1.44
Positive
100DMA
1.34
Positive
200DMA
1.28
Positive
Market Momentum
MACD
0.05
Negative
RSI
70.49
Negative
STOCH
91.34
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOOP, the sentiment is Positive. The current price of 1.86 is above the 20-day moving average (MA) of 1.55, above the 50-day MA of 1.44, and above the 200-day MA of 1.28, indicating a bullish trend. The MACD of 0.05 indicates Negative momentum. The RSI at 70.49 is Negative, neither overbought nor oversold. The STOCH value of 91.34 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
72
Outperform
$126.06M42.698.06%-1.52%6.38%
70
Outperform
$72.86M24.494.18%2.07%3.46%-34.80%
62
Neutral
$10.28B6.210.76%2.84%3.10%-36.03%
58
Neutral
$394.20M-11.71%341.75%20.16%
54
Neutral
$80.17M-406.97%8400.76%31.02%
48
Neutral
$89.01M-28.22%-12.70%-74.32%
$6.77M-14.01%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
LOOP
Loop Industries
1.86
0.50
36.76%
FSI
Flexible Solutions International
9.50
6.34
200.63%
GEVO
Gevo
1.67
0.96
135.21%
NTIC
Northern Technologies International
7.74
-4.31
-35.77%
ALTO
Alto Ingredients
1.17
-0.21
-15.22%
CNEY
CN Energy Group
2.20
-4.97
-69.32%

Loop Industries Corporate Events

Business Operations and Strategy
Loop Industries Expands with New Facility in India
Positive
Aug 19, 2025

On August 13, 2025, Loop Industries‘ joint venture, Ester Loop Infinite Technologies Private Limited, signed an agreement to acquire 93 acres of land in Gujarat, India, for an Infinite Loop™ manufacturing facility. The agreement involves land consolidation, title transfer, and necessary governmental approvals, with a purchase price of 9,072,000 Indian rupees per acre. The project aims to enhance Loop Industries’ operational capacity and strengthen its market position in sustainable recycling technologies.

Executive/Board ChangesShareholder Meetings
Loop Industries Holds 2025 Annual Stockholders Meeting
Neutral
Jul 23, 2025

On July 18, 2025, Loop Industries, Inc. held its 2025 Annual Meeting of Stockholders virtually, where several key decisions were made. The stockholders elected five directors to the Board and appointed Daniel Solomita as a director through a special vote. Additionally, the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending February 28, 2026, was ratified. The stockholders also approved the compensation of the company’s named executive officers and decided that future advisory votes on executive compensation will occur annually.

Private Placements and FinancingBusiness Operations and Strategy
Loop Industries Announces At the Market Offering
Neutral
Jul 3, 2025

On July 3, 2025, Loop Industries entered into an At the Market Offering Agreement with Roth Capital Partners, allowing the company to sell up to $15 million of its common stock through the sales agent. This strategic move, facilitated by a shelf registration statement effective since September 2024, aims to enhance the company’s financial flexibility and market presence, although there is no obligation to sell a specific amount of shares.

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