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Northern Technologies International
(NASDAQ:NTIC)
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Rating:54Neutral
Price Target:
$9.00
▲(11.94% Upside)
Action:Reiterated
Date:07/09/26
The score is held back primarily by weakened financial performance—TTM losses and negative operating/free cash flow—despite a relatively conservative balance sheet and solid multi-year revenue growth. Technical indicators are moderately supportive with price above key averages and positive MACD. Earnings-call guidance points to sequential Q4 margin and profitability improvement, but recent gross-margin pressure and higher debt remain meaningful near-term risks, and valuation is constrained by a negative P/E and the suspended dividend.
Positive Factors
Conservative balance sheet & modest leverage
NTIC's balance sheet shows low-to-moderate leverage and sizable equity versus assets, providing resilience to cyclical shocks and capacity to support JV investments or targeted capex. This structural conservatism preserves strategic optionality during industry cycles and funding needs.
Negative Factors
Weak cash generation and negative FCF
A return to negative operating and free cash flow meaningfully erodes internal funding capacity, forcing reliance on revolver drawdowns, JV liquidity or asset sales. Persisting cash burn constrains reinvestment, debt reduction, and shareholder returns over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet & modest leverage
NTIC's balance sheet shows low-to-moderate leverage and sizable equity versus assets, providing resilience to cyclical shocks and capacity to support JV investments or targeted capex. This structural conservatism preserves strategic optionality during industry cycles and funding needs.
Read all positive factors
Northern Technologies International (NTIC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$76.16M
Dividend Yield0.5%
Average Volume (3M)34.28K
Price to Earnings (P/E)―
Beta (1Y)0.11
Revenue Growth7.70%
EPS Growth-139.19%
CountryUS
Employees272
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)-0.13
Shares Outstanding9,496,439
10 Day Avg. Volume44,907
30 Day Avg. Volume34,278
Financial Highlights & Ratios
PEG Ratio-39.08
Price to Book (P/B)0.97
Price to Sales (P/S)0.83
P/FCF Ratio-46.52
Enterprise Value/Market Cap1.12
Enterprise Value/Revenue0.93
Enterprise Value/Gross Profit2.60
Enterprise Value/Ebitda18.81
Forecast
1Y Price Target
$13.00Price Target Upside61.69% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)0.15
Revenue Forecast (FY)$92.90M
Northern Technologies International Business Overview & Revenue Model
Company Description
Northern Technologies International Corporation (NTIC) specializes in the development and global distribution of advanced rust and corrosion prevention solutions. Operating across North and South America, Europe, Asia, and the Middle East, the com...
How the Company Makes Money
NTIC primarily makes money by selling corrosion prevention solutions and polymer-related products and services. Its core revenue stream is the corrosion prevention segment, which includes sales of proprietary corrosion-inhibiting packaging (e.g., ...
Northern Technologies International Earnings Call Summary
Earnings Call Date:Jul 09, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Nov 18, 2026
Earnings Call Sentiment Positive
The call highlighted meaningful top‑line momentum across core platforms—record consolidated sales (+12.6%), strong joint venture performance (+15.1%) and a breakout in ZERUST oil & gas (+72.3%, TTM >$10M), along with Natur‑Tec commercialization initiatives and disciplined operating expense control. These positives were offset by significant gross margin pressure driven by a global raw‑material price spike (LDPE +30%+), which compressed margins by ~477 bps and resulted in a modest GAAP and non‑GAAP loss for the quarter. Management presented concrete remediation actions (pricing, procurement, and expected Q4 margin recovery), pending asset sale proceeds, and confidence in improving profitability. Overall, growth metrics and forward‑looking remediation plans are prominent, but near‑term profitability and leverage are clear near‑term weaknesses.Positive Updates
Record Consolidated Sales and Double‑Digit Growth
Total consolidated net sales rose 12.6% year‑over‑year to $24.2 million for Q3 FY26, marking a record quarterly high and the second consecutive quarter of year‑over‑year double‑digit growth.
Negative Updates
Gross Margin Compression from Raw Material Cost Spike
Gross profit margin declined to 33.6% in Q3 FY26 from 38.4% a year earlier, a compression of ~477 basis points. Management attributes the primary cause to sharp raw material cost increases (LDPE up 30%+ due to shipping disruptions through the Strait of Hormuz), estimating a roughly $1.0 million negative impact to gross profit for the quarter.
Read all updates
Q3-2026 Updates
Positive
Negative
Record Consolidated Sales and Double‑Digit Growth
Total consolidated net sales rose 12.6% year‑over‑year to $24.2 million for Q3 FY26, marking a record quarterly high and the second consecutive quarter of year‑over‑year double‑digit growth.
Read all positive updates
Company Guidance
Management guided to a stronger, more profitable fourth quarter, saying they expect Q4 sales to be higher than Q3’s $24.2 million (Q3 sales +12.6% YoY) and gross margin to improve sequentially from the Q3 level of 33.6% (down ~477 bps YoY and an estimated ~$1.0 million hit from Middle East shipping disruptions); they expect sales to grow faster than operating expenses (Q3 operating expenses $10.2M, 42.0% of sales, up 5.3% YoY) and to drive improved profitability by leveraging higher‑margin ZERUST oil & gas (Q3 oil & gas $2.2M, +72.3% YoY; TTM oil & gas > $10M) and expanding Natur‑Tec (Q3 Natur‑Tec $6.1M, +5% YoY) while pursuing pricing, procurement and working‑capital initiatives, targeting debt reduction from the current $14.8M outstanding (including $11.8M revolver) via operating cash flow and efficiencies, and anticipating more than $1M in proceeds from the planned Beachwood sale (LOI $1.15M) expected to close in fiscal 2027.Northern Technologies International Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
72
Positive
Cash Flow
33
Negative
| Breakdown | TTM | Aug 2025 | Aug 2024 | Aug 2023 | Aug 2022 | Aug 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 91.84M | 84.23M | 85.06M | 79.90M | 74.16M | 56.49M |
| Gross Profit | 32.84M | 31.68M | 33.79M | 27.80M | 23.07M | 19.57M |
| EBITDA | 4.54M | 5.39M | 9.74M | 7.68M | 10.72M | 9.58M |
| Net Income | -1.16M | 17.62K | 5.41M | 2.91M | 6.32M | 6.28M |
Balance Sheet | ||||||
| Total Assets | 107.13M | 102.75M | 94.68M | 89.34M | 86.19M | 74.37M |
| Cash, Cash Equivalents and Short-Term Investments | 8.15M | 7.25M | 4.95M | 5.41M | 5.34M | 7.69M |
| Total Debt | 15.75M | 13.15M | 7.54M | 6.79M | 6.46M | 376.44K |
| Total Liabilities | 29.84M | 26.03M | 19.50M | 18.65M | 18.95M | 8.62M |
| Stockholders Equity | 72.82M | 72.15M | 71.19M | 66.36M | 63.60M | 62.37M |
Cash Flow | ||||||
| Free Cash Flow | -3.73M | -1.51M | 2.46M | 2.18M | -557.75K | -2.75M |
| Operating Cash Flow | -2.12M | 2.44M | 5.88M | 5.54M | 1.15M | 2.89M |
| Investing Cash Flow | -1.79M | -3.93M | -3.42M | -3.34M | -7.11M | -103.32K |
| Financing Cash Flow | 4.35M | 3.86M | -2.96M | -2.05M | 3.19M | -1.52M |
Northern Technologies International Technical Analysis
Positive
8.04
Price Trends
8.17
Positive
8.15
Positive
8.20
Positive
Market Momentum
-0.04
Negative
59.85
Neutral
56.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTIC, the sentiment is Positive. The current price of 8.04 is below the 20-day moving average (MA) of 8.15, below the 50-day MA of 8.17, and below the 200-day MA of 8.20, indicating a bullish trend. The MACD of -0.04 indicates Negative momentum. The RSI at 59.85 is Neutral, neither overbought nor oversold. The STOCH value of 56.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NTIC.
Northern Technologies International Risk Analysis
Northern Technologies International disclosed 53 risk factors in its most recent earnings report. Northern Technologies International 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
Northern Technologies International 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 | $368.83M | 12.43 | 12.66% | ― | -3.69% | ― | |
54 Neutral | $76.16M | -62.36 | -1.60% | 0.50% | 7.70% | -139.19% | |
54 Neutral | $64.25M | 77.54 | 2.11% | ― | 7.82% | -64.59% | |
50 Neutral | $7.16M | -0.71 | -76.20% | ― | 15.67% | 75.35% | |
44 Neutral | $35.30M | -2.88 | 142.32% | ― | -96.04% | 9.12% |
* Basic Materials Sector Average
NTIC
Northern Technologies International
8.51
1.07
14.35%
FSI
Flexible Solutions International
5.00
-0.50
-9.09%
ALTO
Alto Ingredients
5.29
4.25
408.65%
SNES
SenesTech
1.67
-3.69
-68.84%
LOOP
Loop Industries
0.73
-0.99
-57.79%
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.