Natuzzi SPA (NTZ) AI Stock Analysis

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Natuzzi SPA

(NYSE:NTZ)

Rating:48Neutral

Price Target:

$4.00

▼(-3.61%Downside)

Natuzzi SPA's overall stock score is primarily impacted by financial challenges, including declining revenues and profitability issues. Technical analysis and valuation further weigh down the score. Despite some strategic improvements highlighted in the earnings call, execution risks and ongoing operational losses remain significant concerns.

Natuzzi SPA (NTZ) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$47.32M

Dividend YieldN/A

Average Volume (3M)6.05K

Price to Earnings (P/E)―

Beta (1Y)0.97

Revenue Growth-2.91%

EPS Growth3.98%

CountryUS

Employees3,205

SectorConsumer Cyclical

Sector Strength70

IndustryFurnishings, Fixtures & Appliances

Share Statistics

EPS (TTM)-1.50

Shares Outstanding11,014,609

10 Day Avg. Volume5,897

30 Day Avg. Volume6,054

Financial Highlights & Ratios

PEG Ratio0.01

Price to Book (P/B)0.13

Price to Sales (P/S)0.00

P/FCF Ratio-1.05

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Natuzzi SPA Business Overview & Revenue Model

Company DescriptionNatuzzi S.p.A. (NTZ) is an Italian furniture company renowned for its premium leather sofas and armchairs. Established in 1959, the company operates in the design, production, and marketing of a wide range of furnishings, including living room collections, bedroom sets, and home accessories. Natuzzi is recognized for its innovative designs and craftsmanship, offering products that blend Italian artistry with functional elegance.

How the Company Makes MoneyNatuzzi makes money primarily through the sale of its furniture products, which are distributed globally across its retail network. The company's revenue streams include direct sales through Natuzzi-branded stores and online platforms, as well as wholesale distribution to third-party retailers. Natuzzi also engages in strategic partnerships and collaborations to expand its market presence and enhance brand visibility. Factors contributing to its earnings include its strong brand reputation, a diverse product portfolio, and a focus on design and quality, which drive customer demand and loyalty.

Natuzzi SPA Earnings Call Summary

Earnings Call Date:Apr 23, 2025

(Q4-2024)

% Change Since: 5.06%|

Next Earnings Date:Jun 27, 2025

Earnings Call Sentiment Neutral

The earnings call revealed significant improvements in gross margin and branded sales strategy, highlighting the company's resilience. However, these were counterbalanced by challenges such as a decline in overall sales, operational losses, and production-related backlogs. The sentiment reflects a mixed outlook with ongoing challenges despite strategic progress.

Q4-2024 Updates

Positive Updates

Increase in Gross Margin

2024 gross margin closed at 36.3%, improving by 2 percentage points versus 2023 (34.3%) and 29.7% in 2019.

Growth in Directly Operated Store Revenue

Directly operated store revenue reported EUR70.1 million, up 4% versus 2023 and 18% versus 2019.

Successful Branded Sales Strategy

Branded sales reached EUR289 million, representing 93% of total sales, an increase from 80% in 2019.

Restructuring and Cost Management

Reduction of 1,141 people over three years, focusing on enhancing marketing and retail competencies.

Effective Production Reallocation

Relocation of production from Shanghai to Quanjiao in China, and Natuzzi Edition production for North America moved to Europe.

Negative Updates

Decline in Overall Sales

Total sales decreased by 3% to EUR318.8 million compared to the previous year.

Operational Loss

The company posted a loss of EUR6.3 million despite efforts to lower the breakeven point.

Increased Backlog Due to Production Changes

A backlog increase of EUR6.4 million occurred in the last quarter due to production reallocation.

Challenges with Store Closures

Closure of nonperforming stores in Spain, Switzerland, and one Divani&Divani store.

Company Guidance

During the Natuzzi S.p.A. Fourth Quarter and Full Year 2024 financial results call, the company provided comprehensive guidance and insights into its operations and strategic direction. The fiscal year 2024 closed with sales at EUR 318.8 million, a 3% decrease from the previous year, highlighting market volatility. Branded sales contributed EUR 289 million, demonstrating resilience and a strategic shift towards brand retailing, now comprising 93% of total sales compared to 80% in 2019. Gross margin increased to 36.3%, up from 34.3% in 2023, signifying improved sales quality and operational efficiency. The company reported a net loss of EUR 6.3 million, a substantial improvement from EUR 22.5 million losses in 2019, despite a EUR 70 million revenue reduction. Key operational shifts included relocating production from Shanghai to Quanjiao and moving North America-bound Natuzzi Edition production to Europe. The company also reduced its workforce by 26% over three years, aligning resources with strategic priorities. Retail performance was bolstered by a 4% increase in directly operated store sales to EUR 70.1 million, with significant growth in the U.S. market. The call emphasized the transformation from a manufacturing entity to a brand retailer, focusing on enhancing customer experience, merchandising, and digital capabilities to drive future sales growth.

Natuzzi SPA Financial Statement Overview

Summary

Natuzzi SPA faces significant financial challenges, with declining revenues and persistent losses impacting its overall financial health. The balance sheet shows high leverage and decreasing equity, which could exacerbate financial stress. Cash flow issues further limit the company's ability to invest in growth or manage debt efficiently. Overall, the company needs strategic restructuring to improve its financial standing.

Income Statement

Neutral

Natuzzi SPA's revenue has been declining from $468.5M in 2022 to $318.8M in 2024, indicating a significant revenue contraction. The company has reported negative EBIT and net income for recent years, reflecting operational losses and challenges in achieving profitability. Gross profit margins have also decreased, indicating pressures on cost management. The consistent negative net profit margin and EBIT margin highlight ongoing profitability struggles.

Balance Sheet

Neutral

The balance sheet shows a high debt-to-equity ratio, indicating higher financial leverage, which poses a risk given the company's profitability issues. Equity has decreased from 2023 to 2024, reducing financial stability. However, the equity ratio remains moderate, suggesting some degree of asset backing. The decline in total assets and equity over the years flags potential liquidity issues.

Cash Flow

Negative

The company's cash flow statement reveals negative free cash flow in recent years, indicating insufficient cash generation to cover capital expenditures. Operating cash flow has also diminished, reflecting reduced cash generation from core operations. The weak operating cash flow to net income ratio further highlights challenges in converting income to cash flow.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
318.80M	328.62M	468.50M	427.40M	328.30M
	Gross Profit
115.70M	120.36M	164.30M	153.80M	103.10M
	EBIT
-6.27M	-9.50M	8.40M	-12.57M	-8.70M
	EBITDA
14.33M	14.41M	31.68M	8.80M	9.56M
	Net Income Common Stockholders
-15.15M	-16.07M	1.30M	3.58M	-24.90M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
20.32M	33.61M	54.48M	53.47M	48.19M
	Total Assets
319.02M	338.35M	368.60M	390.00M	356.00M
	Total Debt
99.80M	102.51M	98.39M	110.72M	100.83M
	Net Debt
79.47M	68.90M	43.92M	57.25M	52.64M
	Total Liabilities
260.82M	265.06M	276.00M	306.20M	280.70M
	Stockholders Equity
54.01M	68.94M	87.90M	82.30M	74.30M
Cash Flow		Free Cash Flow
-5.41M	-8.61M	9.09M	-4.49M	9.43M
	Operating Cash Flow
1.72M	3.21M	18.70M	500.00K	12.30M
	Investing Cash Flow
-4.32M	-7.88M	-4.70M	7.00M	2.30M
	Financing Cash Flow
-12.76M	-15.70M	-13.50M	-2.00M	-5.60M

Natuzzi SPA Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price4.15

Price Trends

50DMA

4.08

Positive

100DMA

4.44

Negative

200DMA

4.39

Negative

Market Momentum

MACD

0.07

Negative

RSI

55.39

Neutral

STOCH

87.48

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTZ, the sentiment is Neutral. The current price of 4.15 is above the 20-day moving average (MA) of 3.76, above the 50-day MA of 4.08, and below the 200-day MA of 4.39, indicating a neutral trend. The MACD of 0.07 indicates Negative momentum. The RSI at 55.39 is Neutral, neither overbought nor oversold. The STOCH value of 87.48 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NTZ.

Natuzzi SPA Risk Analysis

Natuzzi SPA disclosed 25 risk factors in its most recent earnings report. Natuzzi SPA 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 2 New Risks

Failure to protect our intellectual property rights could adversely affect us Q4, 2023

Our inability to accurately forecast demand for our products could affect our profitability Q4, 2023

Natuzzi SPA Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FLXS	76 Outperform	$157.51M	11.65	9.48%	2.21%	7.24%	-9.51%
LZB	72 Outperform	$1.70B	13.82	12.40%	2.04%	1.81%	8.09%
ETD	70 Outperform	$670.33M	11.53	12.09%	5.92%	-6.32%	-18.35%
Sector *	62 Neutral	$6.94B	11.29	2.95%	3.87%	2.70%	-24.49%
MLKN	58 Neutral	$1.15B	40.31	2.28%	4.40%	-2.68%	-56.16%
BSET	55 Neutral	$141.35M	―	-3.83%	4.93%	-11.78%	-13.89%
NTZ	48 Neutral	$47.32M	―	-25.01%	―	-2.91%	3.98%

* Consumer Cyclical Sector Average

Performance Comparison

NTZ

Natuzzi SPA

4.15

-1.11

-21.10%

BSET

Bassett Furniture

16.69

3.28

24.46%

ETD

Ethan Allen

26.02

0.06

0.23%

FLXS

Flexsteel

29.60

-4.94

-14.30%

MLKN

MillerKnoll

17.12

-7.85

-31.44%

LZB

La-Z-Boy Incorporated

40.31

5.73

16.57%

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.