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EcoSynthetix Inc. J (TSE:ECO)
TSX:ECO
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EcoSynthetix
(TSX:ECO)
Rating:46Neutral
Price Target:
C$4.00
▼(-1.23%Downside)
EcoSynthetix (ECO) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$232.73M
Dividend YieldN/A
Average Volume (3M)26.26K
Price to Earnings (P/E)―
Beta (1Y)0.69
Revenue Growth29.27%
EPS Growth42.35%
CountryCA
Employees28
SectorBasic Materials
Sector Strength63
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)-0.01
Shares Outstanding58,769,740
10 Day Avg. Volume22,836
30 Day Avg. Volume26,257
Financial Highlights & Ratios
PEG Ratio-48.95
Price to Book (P/B)4.42
Price to Sales (P/S)0.00
P/FCF Ratio-296.37
Enterprise Value/Market Cap0.69
Enterprise Value/Revenue2.41
Enterprise Value/Gross Profit31.94
Enterprise Value/Ebitda-15.77
Forecast
1Y Price Target
C$4.00Price Target Upside-1.23% Downside
Rating ConsensusHold
Number of Analyst Covering0
EcoSynthetix Business Overview & Revenue Model
Company DescriptionEcoSynthetix Inc., a renewable chemicals company, develops and commercializes bio-based technologies that are used as replacement solutions for synthetic, petrochemical-based adhesives, and other related products in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company offers EcoMer biomonomer for use in pressure sensitive adhesives, ink, toner resins, and paints; EcoSphere biolatex, a bio-based latex binder used in paper and paperboard coatings; EcoStix, a family of sugar-acrylic and pressure-sensitive adhesives, which include customizable resin grades and formulated grades; and DuraBind engineered biopolymers that enable manufacturers of particle board, MDF, veneers, and laminates to decrease the amount of highly regulated chemicals, such as formaldehyde in their formulation. Its products are used in various industries, such as paper and paper board; building materials; adhesives, paints, and coatings; films, recyclable packaging, labels, and stamps; and personal care products. The company was founded in 1996 and is headquartered in Burlington, Canada.
How the Company Makes MoneyEcoSynthetix makes money primarily through the sale of its bio-based products, which are used as sustainable alternatives to conventional petroleum-based materials. The company's revenue streams include direct sales to manufacturers in industries like paper and packaging, where their products are used as adhesives, binders, and coating agents. Additionally, EcoSynthetix benefits from strategic partnerships with leading global manufacturers and suppliers, which help expand its market reach and drive sales growth. The company also invests in research and development to innovate and expand its product offerings, thus enhancing its competitive edge and revenue potential.
EcoSynthetix Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q3-2024)
| % Change Since: -4.93%|
Next Earnings Date:Jul 29, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook with significant sales growth, transition to profitability, and increased demand across all markets. However, there were challenges in the tissue and paperboard market and a decrease in average selling prices. Overall, the sentiment leans towards optimism with noticeable highlights outweighing the lowlights.Q3-2024 Updates
Positive Updates
Significant Sales Growth
Sales were up 38% to $5.2 million in Q3 from the same period last year, driven by a 56% increase in demand for products.
Transition to Profitability
Achieved profitability with $365,000 in positive adjusted EBITDA and $1.6 million in cash from operating activities.
Increased Demand Across All Markets
Growth observed in all target end markets including wood composites, tissue, paperboard, pulp, and personal care, indicating successful diversification strategy.
Successful Pulp Trial Program
Made significant progress with a large global pulp manufacturer, becoming an important strategic and commercial account.
Stable Supply Chain
Stable period with no significant movements in raw materials, a better macro environment compared to previous years.
Negative Updates
Challenges in Tissue and Paperboard Market
Winning new lines or accounts is taking longer than anticipated, leading to frustration despite ongoing trials and engagement.
Lower Average Selling Price
Sales were negatively impacted by $700,000 or 18% due to lower average selling prices, primarily from lower manufacturing costs passed to customers.
Company Guidance
During the EcoSynthetix Q3 2024 earnings call, the company reported a robust quarter with sales increasing by 38% to $5.2 million compared to the same period last year. The surge in demand, up 56% for the quarter and 47% year-to-date, was a major driver behind this growth. The company achieved a positive adjusted EBITDA of $365,000 and generated $1.6 million in cash from operating activities. Gross profit rose by 51% to $1.7 million, with a margin of 36.8%, despite a lower average selling price impacting sales by $700,000. SG&A expenses increased to $1.5 million, primarily due to higher variable-based compensation, while R&D expenses remained relatively stable at $540,000. The cash position stood at $33.5 million as of September 30, 2024, with significant investments made in share buybacks. The company emphasized the success of its diversification strategy and highlighted progress in trials and partnerships across various end markets, including wood composites, pulp, and personal care.EcoSynthetix Financial Statement Overview
Summary
EcoSynthetix faces significant financial challenges, particularly in achieving profitability and stable revenue growth. While the balance sheet is strong with low debt and high equity, cash flow inconsistencies and negative earnings are concerning.Income Statement
EcoSynthetix shows a consistent pattern of negative EBIT and net income, indicating ongoing operational challenges. Although there is a slight improvement in gross profit margin, the company has not yet achieved profitability. Revenue fluctuations suggest instability, with recent periods showing revenue decline.35
Negative
Balance Sheet
The balance sheet reflects a solid equity position with a high equity ratio, indicating financial stability. Despite low leverage, the company has seen declining stockholders' equity over recent periods. The debt-to-equity ratio is favorable, suggesting limited financial risk from debt.55
Neutral
Cash Flow
Operating and free cash flows have been inconsistent, with recent periods showing negative free cash flow. The operating cash flow to net income ratio suggests operational inefficiencies, although the company has managed to maintain positive operating cash flow in the TTM period.40
Negative
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 18.54M | 12.66M | 19.03M | 18.16M | 13.66M |
| Gross Profit | 5.31M | 2.78M | 4.15M | 3.97M | 2.74M |
| EBITDA | -2.02M | -3.24M | -1.77M | -1.86M | -1.57M |
| Net Income | -1.37M | -2.82M | -1.32M | -3.12M | -1.80M |
Balance Sheet | |||||
| Total Assets | 41.28M | 42.84M | 48.19M | 50.98M | 51.72M |
| Cash, Cash Equivalents and Short-Term Investments | 32.20M | 33.28M | 25.86M | 42.23M | 41.98M |
| Total Debt | 237.79K | 584.36K | 819.47K | 1.08M | 1.31M |
| Total Liabilities | 1.94M | 1.87M | 3.14M | 3.18M | 2.25M |
| Stockholders Equity | 39.35M | 40.97M | 45.06M | 47.80M | 49.47M |
Cash Flow | |||||
| Free Cash Flow | 236.11K | -1.31M | -5.17M | 94.09K | -21.37K |
| Operating Cash Flow | 1.10M | 316.99K | -4.90M | 474.07K | 226.78K |
| Investing Cash Flow | 3.47M | 2.00M | -31.15M | 24.69M | 9.75M |
| Financing Cash Flow | -1.73M | -2.27M | -1.51M | 474.28K | -1.43M |
EcoSynthetix Technical Analysis
Neutral
4.05
Price Trends
4.04
Positive
4.20
Negative
4.24
Negative
Market Momentum
-0.02
Positive
50.58
Neutral
49.49
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ECO, the sentiment is Neutral. The current price of 4.05 is below the 20-day moving average (MA) of 4.05, above the 50-day MA of 4.04, and below the 200-day MA of 4.24, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 50.58 is Neutral, neither overbought nor oversold. The STOCH value of 49.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:ECO.
EcoSynthetix Peers Comparison
Overall Rating
UnderperformOutperform
Sector (70)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | C$690.10M | ― | -3.70% | 2.42% | -12.01% | -698.83% | |
70 Outperform | ¥175.49B | 11.17 | 6.29% | 3.42% | 3.91% | 3.49% | |
63 Neutral | C$72.01M | ― | -72.52% | ― | -9.37% | 22.80% | |
59 Neutral | C$66.71M | ― | -96.25% | ― | 203.80% | 16.89% | |
58 Neutral | C$127.60M | ― | -11.69% | 2.98% | -2.69% | 66.63% | |
46 Neutral | C$232.73M | ― | -3.46% | ― | 29.27% | 42.35% | |
45 Neutral | C$105.92M | ― | -51.47% | ― | ― | 13.34% |
* Basic Materials Sector Average
Performance Comparison
TSE:ECO
EcoSynthetix
4.05
-0.25
-5.81%
TSE:BOS
Airboss of America
4.85
-0.44
-8.32%
TSE:NANO
Nano One Materials
1.02
-0.25
-19.69%
TSE:NEO
Neo Performance Materials Inc
16.83
8.94
113.31%
TSE:GMG
Graphene Manufacturing Group Ltd
0.82
0.15
22.39%
TSE:HG
Hydrograph Clean Power
0.30
0.14
87.50%
EcoSynthetix Corporate Events
Executive/Board ChangesShareholder Meetings
EcoSynthetix Elects New Board Members and Appoints New Chair
Neutral
May 23, 2025
EcoSynthetix announced the election results for its Board of Directors at the recent Annual Meeting of Shareholders. Five nominees were elected, with Gregory Yull joining as a new member, replacing Paul Lucas who retired after a decade of service. Jeffrey Nodland was appointed as the new chair. The company anticipates leveraging Yull’s extensive experience in industrial manufacturing and sales to enhance its operations. All other resolutions at the meeting were also approved.
Business Operations and StrategyFinancial Disclosures
EcoSynthetix Reports Q1 2025 Results Amid Market Challenges
Neutral
May 8, 2025
EcoSynthetix reported a 14% decrease in net sales for Q1 2025, attributed to an inventory buildup by a distributor and uncertain macroeconomic conditions. Despite this, the company maintained a strong balance sheet with $31.4 million in cash and term deposits. EcoSynthetix secured new commercial lines for its SurfLock™ strength aids with international pulp manufacturers, highlighting the product’s value across tissue, paperboard, and pulp markets. The company continues to focus on growing with strategic accounts and partners, leveraging its bio-polymers’ sustainability benefits to drive industrial change. With disciplined capital allocation, EcoSynthetix is well-positioned to capitalize on growth opportunities in its target markets.
Business Operations and StrategyFinancial Disclosures
EcoSynthetix Reports Q1 2025 Results Amid Market Challenges
Neutral
May 8, 2025
EcoSynthetix reported a 14% decline in net sales for Q1 2025, primarily due to an inventory buildup by a distributor and an uncertain macro environment. Despite the decrease in sales, the company maintained a strong balance sheet with $31.4 million in cash and term deposits. The company secured new commercial lines for its SurfLock™ strength aids, indicating continued demand and strategic partnerships in its key markets. EcoSynthetix remains committed to growing with strategic accounts and partners, focusing on the long-term potential of its bio-polymers in various industries.
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.