Zentek (ZEN) AI Stock Analysis

• Market Cap: C$136.65M
• Dividend Yield: N/A
• Average Volume (3M): 27.71K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.27
• Revenue Growth: 92.38%
• EPS Growth: 12.79%
• Country: CA
• Employees: 25
• Sector: Healthcare
• Sector Strength: 77
• Industry: Medical Equipment & Supplies
• EPS (TTM): -0.10
• Shares Outstanding: 104,311,450
• 10 Day Avg. Volume: 18,801
• 30 Day Avg. Volume: 27,710
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3516.78
• Price to Cash Flow (P/CF): -18.90
• P/FCF Ratio: 0.00
• 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: N/A
• Number of Analyst Covering: 0

Zentek's overall stock score reflects significant financial challenges, particularly in profitability and cash flow. While technical indicators show bearish trends, recent corporate achievements provide some optimism for future growth. However, the current negative valuation metrics and lack of dividend yield remain key concerns. Investors should proceed with caution, focusing on the company's ability to translate recent developments into financial improvements.

Zentek Business Overview & Revenue Model

Company Description

Zentek Ltd. (ZEN) is a Canadian-based nanotechnology company focused on the research, development, and commercialization of innovative nanomaterials. The company's core products and services revolve around advanced materials for healthcare, protective coatings, and environmental applications. Zentek leverages its expertise in graphene-based technologies to provide solutions that enhance product performance, safety, and sustainability.

How the Company Makes Money

Zentek generates revenue primarily through the commercialization and sale of its nanotechnology-based products and solutions. Key revenue streams include the sales of graphene-based materials and coatings, which are used in various industries such as healthcare, aerospace, and automotive for enhanced protection and performance. The company also collaborates with strategic partners to co-develop and market new products, contributing to its earnings. Additionally, Zentek may earn revenue from licensing its proprietary technologies and intellectual property to other companies seeking to incorporate advanced nanomaterials into their offerings.

Zentek Financial Statement Overview

Summary

Zentek faces significant challenges in profitability and cash flow, with negative margins and weak operational cash conversion. Despite low debt levels, operational inefficiencies are evident, impacting financial health.

Income Statement

Zentek has been struggling with profitability, as indicated by consistent negative gross and net profit margins over the analyzed period. The most recent TTM figures show a gross profit margin of -3412%, a net profit margin of -16480%, and a declining revenue trend. These metrics highlight significant challenges in cost management and revenue generation, severely impacting the company's income statement performance.

Balance Sheet

Zentek's balance sheet shows moderate leverage with a debt-to-equity ratio of 0.05 in the latest TTM period, suggesting low reliance on debt financing. However, the company's equity ratio has been decreasing, from 91% in 2020 to 85% in the latest TTM, indicating a potential weakening in financial stability. Although the company has a solid equity base, the declining trend in equity ratio requires attention.

Cash Flow

The cash flow analysis reveals substantial challenges, with persistent negative free cash flow and operating cash flow figures. The latest TTM period shows a concerning free cash flow to net income ratio of 0.63, indicating a weak cash conversion from operations. Despite occasional positive financing cash flows, overall cash flows remain under pressure, affecting financial flexibility.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
64.66K	29.82K	72.86K	339.67K	2.35K	0.00
	Gross Profit
-2.21M	-385.06K	-780.48K	-275.04K	-124.44K	-24.88K
	EBIT
-7.09M	-10.99M	-14.15M	-12.56M	-3.98M	-1.68M
	EBITDA
-9.73M	-11.08M	-13.75M	-11.27M	-3.73M	-1.55M
	Net Income Common Stockholders
-10.66M	-11.70M	-14.41M	-38.69M	-3.87M	-1.53M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.48M	3.52M	10.36M	26.68M	3.09M	805.95K
	Total Assets
19.03M	22.59M	33.29M	37.98M	30.25M	26.24M
	Total Debt
759.63K	1.24M	1.61M	2.23M	404.32K	0.00
	Net Debt
-725.10K	-2.28M	-8.75M	-24.44M	-2.69M	-805.95K
	Total Liabilities
2.83M	2.41M	2.90M	3.44M	2.79M	527.58K
	Stockholders Equity
16.20M	20.17M	30.38M	34.55M	27.46M	25.71M
Cash Flow		Free Cash Flow
-6.70M	-8.37M	-15.23M	-11.97M	-2.05M	-1.46M
	Operating Cash Flow
-6.69M	-8.05M	-12.96M	-7.99M	-1.79M	-1.36M
	Investing Cash Flow
408.83K	1.88M	-2.31M	-7.25M	-1.23M	-1.24M
	Financing Cash Flow
2.42M	-665.47K	-1.05M	38.82M	5.31M	2.18M

Zentek Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.33
• 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:ZEN, the sentiment is Negative. The current price of 1.33 is below the 20-day moving average (MA) of 1.37, below the 50-day MA of 1.48, and below the 200-day MA of 1.34, indicating a bearish trend. The MACD of -0.05 indicates Positive momentum. The RSI at 41.01 is Neutral, neither overbought nor oversold. The STOCH value of 32.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ZEN.

Zentek Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GRA	49 Neutral	C$417.99M	―	-10.44%	―	12.92%	-3.66%
Sector *	49 Neutral	$6.93B	0.23	-53.86%	2.46%	21.78%	-1.36%
NGC	44 Neutral	C$12.45M	―	-329.25%	―	31.19%	-46.99%
ZEN	37 Underperform	C$136.65M	―	-54.98%	―	92.38%	12.79%
SRL	35 Underperform	C$23.64M	―	-20.39%	―	―	29.22%
FMS	32 Underperform	C$6.80M	―	-16.19%	―	―	-49.81%
HPQ	26 Underperform	C$91.30M	―	-399.98%	―	―	7.43%

Zentek Corporate Events

Zentek Completes Key Testing for ZenGUARD™ Air Filters

Zentek Ltd. has successfully completed shelf-life efficacy testing for its ZenGUARD™ Enhanced Air Filters, demonstrating that the product maintains its viral filtration efficiency over a 20-month period. This achievement is crucial for the commercialization of the filters as a Class I medical device, ensuring compliance with medical device regulations and confirming the product’s reliability and safety for stakeholders.

Zentek Initiates US$30 Million At-The-Market Offering in the U.S.

Zentek Ltd. has announced a US$30 million at-the-market offering in the United States, with Rodman & Renshaw LLC acting as the exclusive sales agent. The proceeds from this offering will be used for corporate purposes, and the sales will be conducted on the Nasdaq Capital Markets or other recognized U.S. marketplaces, excluding Canadian markets.

Zentek’s Albany Graphite Corp. Achieves Breakthrough in Graphite Purification and Rare Earth Element Recovery

Zentek’s subsidiary, Albany Graphite Corp., has announced significant results from its thermal purification testwork using a fluidized bed reactor. The process demonstrated the ability to achieve 99.9991% purity in graphite and recover rare earth elements as by-products, enhancing Zentek’s potential in the battery and nuclear graphite markets.

Zentek Readies Launch for ZenGUARD™ Air Filters in Canadian Market

Zentek is preparing to launch its ZenGUARD™ Enhanced Air Filters in Canada, prioritizing necessary documentation to comply with regulatory standards. The company aims to initiate sales by March 2025, leveraging its manufacturing partner’s network and government procurement opportunities to drive growth. ZenGUARD™ Enhanced Air Filters have been validated as safe and effective, making them eligible for government purchase, which could enhance Zentek’s market positioning and provide potential cost and emission savings for government agencies.

Zentek’s Albany Graphite Achieves Ultra-High Purity for Advanced Applications

Zentek’s subsidiary, Albany Graphite Corporation, has successfully achieved a five-nines purity level of 99.9991% for graphite using a pilot-scale fluidized bed reactor. This breakthrough in purification technology positions Zentek to further test the material’s suitability for high-demand applications, including its use as an anode component in lithium-ion batteries and potentially in the nuclear industry. The company is committed to advancing both production and processing capabilities to develop battery-ready anode active materials and enhance cathode conductivity.