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S&W Seed Company (SANW)
OTHER OTC:SANW
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S&W Seed Company
(OTC:SANW)
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Rating:42Neutral
Price Target:
$1.50
▲(971.43% Upside)
S&W Seed Company's stock is rated poorly due to significant financial challenges, including negative profitability and revenue declines. The company's technical indicators are bearish, and recent corporate events highlight financial distress. While there is some optimism in operational improvements, the overall outlook remains negative.
Positive Factors
Operational Efficiency
Achieving positive adjusted EBITDA reflects successful cost-saving initiatives and improved operational efficiencies, which can enhance long-term profitability and competitiveness.
Product Development
The successful launch and sell-out of the Prussic Acid Free trait indicate strong market demand and potential for future growth, supporting long-term revenue expansion.
Gross Margin Improvement
Significant gross margin improvement due to operational efficiencies and higher-margin products suggests enhanced profitability potential and strategic focus on value-added offerings.
Negative Factors
Revenue Decline
A significant revenue decline indicates challenges in market demand or competitive positioning, which can impact long-term growth prospects and financial stability.
Financial Distress
The planned collateral sale due to financial obligations highlights severe financial distress, potentially affecting operational capabilities and stakeholder confidence.
Nasdaq Delisting
Delisting from Nasdaq reduces market visibility and access to capital markets, potentially impacting investor confidence and the company's ability to raise funds.
S&W Seed Company (SANW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$343.49K
Dividend YieldN/A
Average Volume (3M)6.64K
Price to Earnings (P/E)―
Beta (1Y)0.39
Revenue Growth-45.02%
EPS Growth-7.27%
CountryUS
Employees134
SectorBasic Materials
Sector Strength58
IndustryAgricultural Farm Products
Share Statistics
EPS (TTM)N/A
Shares Outstanding2,146,806
10 Day Avg. Volume4,891
30 Day Avg. Volume6,644
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)0.34
Price to Sales (P/S)0.25
P/FCF Ratio-2.13
Enterprise Value/Market Cap106.41
Enterprise Value/Revenue0.97
Enterprise Value/Gross Profit4.63
Enterprise Value/Ebitda-2.57
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
S&W Seed Company Business Overview & Revenue Model
Company DescriptionS&W Seed Company, an agricultural company, engages in breeding, growing, processing, and selling alfalfa and sorghum seeds. It also offers sunflower, wheat germplasm, wheat, and pasture seeds. The company sells its seeds to distributors and dealers in 40 countries. S&W Seed Company was founded in 1980 and is headquartered in Longmont, Colorado.
How the Company Makes MoneyS&W Seed Company generates revenue through the sale of its seed products to farmers, distributors, and agricultural companies. The company's key revenue streams include the commercialization of proprietary seed varieties, licensing of seed genetics, and sales of conventional and genetically modified seeds. S&W Seed Company also benefits from strategic partnerships and collaborations with agricultural research institutions and seed technology companies, which enhance its product offerings and market reach. Additionally, the company may earn revenue through government and private contracts, providing seeds for specific agricultural projects and initiatives.
S&W Seed Company Earnings Call Summary
Earnings Call Date:May 15, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 18, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook for S&W Seed Company. While the company achieved its first positive adjusted EBITDA quarter in many years and made significant operational improvements, the impact of Chinese tariffs on US sorghum exports significantly affected revenue and profitability forecasts. Despite these challenges, the company remains optimistic about the long-term potential of its high-margin sorghum traits.Q3-2025 Updates
Positive Updates
First Positive Adjusted EBITDA Quarter
S&W Seed Company reported its first positive adjusted EBITDA quarter in many years, indicating operational improvements and strategic focus on high-margin products.
Strategic Focus and Cost Savings Initiatives
The company completed the VA process in Australia, entered a new $25 million working capital facility, and implemented cost-saving measures, resulting in improved gross margins and reduced operating expenses.
Introduction of Prussic Acid Free Sorghum
Successfully launched Prussic Acid Free sorghum, selling out of launch supplies due to strong customer demand, and planning to ramp up seed production.
Strong Gross Margin Improvement
Gross profit margin for Q3 improved to 37.7% from 24.6% last year's Q3, driven by operational efficiencies and a shift in product mix.
Negative Updates
Impact of Tariffs on US Sorghum Market
Retaliatory tariffs by China on US agricultural products, including sorghum, led to decreased exports, increased domestic inventories, and depressed farm gate prices, prompting some farmers to switch from sorghum to more profitable crops.
Revised Fiscal Year Guidance
Due to tariff impacts, the company revised its fiscal year revenue guidance to $29 million to $31 million, down from $34.5 million to $38 million, and adjusted EBITDA to negative $8.5 million to negative $7 million.
Impact on High-Margin Double Team Products
The majority of the revenue and EBITDA impact is on high-margin Double Team products, which carry 60%-plus margins, affecting overall financial performance.
Company Guidance
During the S&W Seed Company's third-quarter fiscal year 2025 conference call, guidance was updated to reflect a decrease in full-year revenue expectations to between $29 million and $31 million, down from previous estimates of $34.5 million to $38 million. This revision was primarily due to the impact of tariffs on U.S. sorghum exports to China, which affected sorghum seed purchases and led to a projected adjusted EBITDA of negative $8.5 million to negative $7 million. Despite these challenges, the company achieved a positive adjusted EBITDA of $244,000 in the third quarter, a significant improvement from a negative $2.2 million in the same period last year. S&W also reported strong gross margin improvements, reaching 37.7% compared to 24.6% the previous year. The company remains optimistic about the long-term prospects of its high-margin sorghum traits and is focused on strategic alternatives to enhance shareholder value, with ongoing efforts to expand internationally and develop new products.S&W Seed Company Financial Statement Overview
Summary
S&W Seed Company faces revenue decline and profitability challenges, reflected in negative margins and substantial net losses. While the balance sheet shows reduced debt, the low equity ratio highlights ongoing vulnerabilities. Cash flow trends are positive, but overall financial health requires strategic improvements.Income Statement
S&W Seed Company has experienced significant revenue decline from 2021 to the TTM period, indicating a negative growth trajectory with a revenue drop of approximately 37.5% from 2021 to TTM. The gross profit margin for the TTM is relatively low at 24.6%, and the net profit margin is negative due to substantial net losses. This suggests challenges in achieving profitability. The negative EBIT and EBITDA margins further highlight operational inefficiencies.Balance Sheet
The company's debt-to-equity ratio improved in the TTM as total debt decreased significantly, indicating reduced financial leverage. However, the equity ratio is low at 8.8%, suggesting limited equity relative to total assets. The return on equity is negative due to net losses, which is concerning for long-term sustainability. The balance sheet shows some improvement in equity but remains vulnerable with high liabilities.Cash Flow
Free cash flow has improved significantly from a negative position in previous years to a positive $497,701 in the TTM, indicating better cash management. Operating cash flow to net income ratio is positive in the TTM, showing improved cash generation relative to net losses. However, the free cash flow to net income ratio remains low, reflecting ongoing challenges in converting earnings into free cash flow.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 37.76M | 60.44M | 73.52M | 71.35M | 84.05M | 79.58M |
| Gross Profit | 7.89M | 15.81M | 14.54M | 6.36M | 13.68M | 14.93M |
| EBITDA | -14.24M | -15.01M | 25.85M | -27.34M | -10.69M | -11.80M |
| Net Income | -32.24M | -30.03M | 14.41M | -36.32M | -19.11M | -19.75M |
Balance Sheet | ||||||
| Total Assets | 69.61M | 120.73M | 151.99M | 133.79M | 151.47M | 155.96M |
| Cash, Cash Equivalents and Short-Term Investments | 354.50K | 294.01K | 3.40M | 2.06M | 3.53M | 4.12M |
| Total Debt | 21.94M | 54.32M | 56.49M | 51.08M | 47.22M | 43.09M |
| Total Liabilities | 42.79M | 75.69M | 77.89M | 82.38M | 77.08M | 74.62M |
| Stockholders Equity | 32.94M | 44.99M | 68.76M | 51.37M | 74.42M | 81.46M |
Cash Flow | ||||||
| Free Cash Flow | 497.70K | -7.18M | -20.01M | -20.47M | -15.30M | -7.74M |
| Operating Cash Flow | -403.17K | -5.64M | -18.98M | -18.37M | -14.22M | -5.76M |
| Investing Cash Flow | -62.84K | 5.88M | 8.37M | -909.43K | 2.47M | -10.29M |
| Financing Cash Flow | 649.78K | -3.35M | 11.95M | 17.14M | 10.89M | 17.05M |
S&W Seed Company Technical Analysis
Neutral
0.14
Price Trends
0.15
Positive
0.26
Negative
2.02
Negative
Market Momentum
<0.01
Negative
61.61
Neutral
81.22
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SANW, the sentiment is Neutral. The current price of 0.14 is above the 20-day moving average (MA) of 0.10, below the 50-day MA of 0.15, and below the 200-day MA of 2.02, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 61.61 is Neutral, neither overbought nor oversold. The STOCH value of 81.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SANW.
S&W Seed Company Risk Analysis
S&W Seed Company disclosed 49 risk factors in its most recent earnings report. S&W Seed Company 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
S&W Seed Company 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% | |
43 Neutral | $50.78M | -0.20 | ― | ― | 31.61% | 37.02% | |
42 Neutral | $343.49K | -0.02 | ― | ― | -45.02% | -7.27% | |
42 Neutral | $3.73M | -0.06 | ― | ― | ― | ― | |
42 Neutral | $3.22M | -0.04 | -179.10% | ― | -10.77% | 97.27% | |
41 Neutral | $5.75M | -0.25 | -46.64% | ― | -29.40% | -535.63% |
* Basic Materials Sector Average
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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.