EcoSynthetix (ECO) AI Stock Analysis

• Market Cap: C$223.00M
• Dividend Yield: N/A
• Average Volume (3M): 34.75K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.38
• Revenue Growth: 30.76%
• EPS Growth: 52.23%
• Country: CA
• Employees: 28
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): >-0.01
• Shares Outstanding: 58,530,506
• 10 Day Avg. Volume: 57,478
• 30 Day Avg. Volume: 34,747
• PEG Ratio: 2.52
• Price to Book (P/B): 4.49
• Price to Sales (P/S): 9.53
• P/FCF Ratio: 748.43
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 49 Neutral
• Price Target: C$4.00 ▲(4.99% Upside)

EcoSynthetix's overall stock score is driven by its financial performance challenges, including profitability and cash flow issues, despite a strong balance sheet. The technical analysis indicates bearish trends, and valuation metrics are weak due to ongoing losses. However, the earnings call provided a positive outlook with strong sales growth and market diversification, which slightly offsets the negative aspects.

Positive Factors

Market Diversification

EcoSynthetix's diversification into multiple markets like pulp and tissue enhances its resilience and growth potential, reducing dependency on any single sector.

Strong Balance Sheet

A robust balance sheet with low leverage provides financial stability and flexibility to invest in growth opportunities and withstand economic fluctuations.

Operational Efficiency Improvements

Enhancing operational efficiency through internal production boosts productivity, potentially lowering costs and improving margins over the long term.

Negative Factors

Profitability Challenges

Ongoing profitability issues, reflected in negative margins, could hinder the company's ability to reinvest in growth and innovation, impacting long-term competitiveness.

Decline in Gross Profit Percentage

A declining gross profit margin indicates rising costs and pricing pressures, which could erode profitability and affect financial health if not addressed.

Cash Flow Concerns

Negative cash flow limits the company's ability to fund operations and growth initiatives internally, potentially increasing reliance on external financing.

EcoSynthetix Business Overview & Revenue Model

Company Description

EcoSynthetix (ECO) is a leading provider of sustainable materials, specializing in the production of bio-based and renewable synthetic materials. The company operates within the green chemistry sector and focuses on creating eco-friendly alternatives to traditional petroleum-based products. EcoSynthetix's core offerings include biopolymers and other sustainable materials that are used in various applications, such as packaging, textiles, and construction, promoting environmental sustainability and reducing carbon footprints.

How the Company Makes Money

EcoSynthetix generates revenue primarily through the sale of its bio-based synthetic materials to manufacturers in diverse industries, including packaging, textiles, and consumer goods. The company employs a revenue model that includes direct sales, long-term contracts, and partnerships with key players in these sectors. Significant revenue streams are derived from bulk sales to large manufacturers looking to incorporate sustainable materials into their production processes. Additionally, EcoSynthetix may engage in collaborative projects with industry partners to develop custom solutions, further enhancing its revenue potential. The growing demand for environmentally friendly products and regulatory pressures for sustainability create opportunities for the company to expand its market share and increase earnings.

EcoSynthetix Financial Statement Overview

Summary

EcoSynthetix shows positive revenue growth but struggles with profitability and cash flow management. The strong equity position provides stability, but operational efficiency improvements are needed.

Income Statement

EcoSynthetix shows a mixed performance in its income statement. The TTM data indicates a positive revenue growth rate of 10.18%, suggesting some recovery in sales. However, the company struggles with profitability, as evidenced by negative net profit and EBIT margins. The gross profit margin remains relatively stable at around 28%, but the negative EBIT and EBITDA margins highlight ongoing operational challenges.

Balance Sheet

The balance sheet reflects a strong equity position with a low debt-to-equity ratio of 0.0022, indicating minimal leverage and financial risk. However, the return on equity is negative, suggesting inefficiencies in generating returns from equity investments. The equity ratio remains healthy, underscoring a solid capital structure.

Cash Flow

Cash flow analysis reveals challenges, with a significant decline in free cash flow growth and negative free cash flow to net income ratio. The operating cash flow to net income ratio is positive, indicating some ability to generate cash from operations, but overall cash flow management remains a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	20.31M	18.54M	12.66M	19.03M	18.16M	13.66M
Gross Profit	5.60M	5.31M	2.78M	4.15M	3.97M	2.74M
EBITDA	-1.11M	-2.02M	-3.24M	-1.77M	-1.86M	-1.57M
Net Income	-793.43K	-1.37M	-2.82M	-1.32M	-3.12M	-1.80M
Balance Sheet
Total Assets	43.19M	41.28M	42.84M	48.19M	50.98M	51.72M
Cash, Cash Equivalents and Short-Term Investments	30.42M	32.20M	33.28M	25.86M	42.23M	41.98M
Total Debt	2.24M	237.79K	584.36K	819.47K	1.08M	1.31M
Total Liabilities	4.66M	1.94M	1.87M	3.14M	3.18M	2.25M
Stockholders Equity	38.53M	39.35M	40.97M	45.06M	47.80M	49.47M
Cash Flow
Free Cash Flow	-1.26M	236.11K	-1.31M	-5.17M	94.09K	-21.37K
Operating Cash Flow	-597.03K	1.10M	316.99K	-4.90M	474.07K	226.78K
Investing Cash Flow	6.11M	3.47M	2.00M	-31.15M	24.69M	9.75M
Financing Cash Flow	-1.79M	-1.73M	-2.27M	-1.51M	474.28K	-1.43M

EcoSynthetix Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.81
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ECO, the sentiment is Negative. The current price of 3.81 is below the 20-day moving average (MA) of 4.11, below the 50-day MA of 4.27, and below the 200-day MA of 4.20, indicating a bearish trend. The MACD of -0.11 indicates Positive momentum. The RSI at 35.61 is Neutral, neither overbought nor oversold. The STOCH value of 55.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ECO.

EcoSynthetix Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
CNO	57 Neutral	C$16.03M	-11.67	-61.05%	―	-15.84%	-375.96%
BOS	53 Neutral	C$123.80M	-23.80	-2.95%	3.07%	5.06%	93.02%
GMG	52 Neutral	C$188.43M	-20.59	-92.59%	―	6.29%	-3.71%
ECO	49 Neutral	C$223.00M	-206.22	-2.11%	―	30.76%	52.23%
NANO	45 Neutral	C$126.74M	-8.90	-64.59%	―	―	56.03%
SURE	28 Underperform	C$6.22M	-236.36	―	―	―	91.27%

EcoSynthetix Corporate Events

EcoSynthetix Sees Growth in Q3 2025 with New European Accounts

EcoSynthetix reported a 11% increase in net sales for Q3 2025, driven by higher volumes and new commercial accounts in Europe for its SurfLock™ strength aids. The company maintained a strong balance sheet with $30.4 million in cash and term deposits, and is positioned for long-term growth with strategic partnerships in key markets.

EcoSynthetix Expands European Market with New Tissue Line Contracts

EcoSynthetix Inc. has secured two new tissue line contracts in Europe for its bio-based strength aid, SurfLock™, through a partnership with RNM Group. This development highlights the growing recognition of SurfLock™’s value in strengthening paper applications while using cost-effective or recycled materials, enhancing EcoSynthetix’s market position and expanding its reach in the tissue industry.