Zentek (ZEN) AI Stock Analysis

• Market Cap: $127.75M
• Dividend Yield: N/A
• Average Volume (3M): 57.55K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.01
• Revenue Growth: 2519.47%
• EPS Growth: 22.52%
• Country: CA
• Employees: 24
• Sector: Healthcare
• Sector Strength: 53
• Industry: Medical - Instruments & Supplies
• EPS (TTM): -0.01
• Shares Outstanding: 104,710,460
• 10 Day Avg. Volume: 70,299
• 30 Day Avg. Volume: 57,546
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 165.14
• Enterprise Value/Gross Profit: 651.23
• Enterprise Value/Ebitda: -18.76
• 1Y Price Target: $1.50
• Price Target Upside: 22.66% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 47 Neutral
• Price Target: C$1.50 ▲(22.95% Upside)

Zentek's overall stock score is primarily impacted by its financial performance challenges, including negative margins and cash flows. Technical analysis indicates a bearish trend, and valuation metrics are unattractive due to negative earnings. The absence of earnings call and corporate events data limits further insights.

Zentek Business Overview & Revenue Model

Company Description

Zentek Ltd. engages in the research and development of graphene and related nanomaterials in Canada. It owns 100% interest in the Albany Graphite project located in Northern Ontario, Canada. The company develops graphene-based antimicrobial coating under the ZenGUARD brand, surgical masks, HVAC filters, personal protective equipment, rapid detection point of care diagnostics tests, and pharmaceutical products based on graphene-based compound. In addition, it develops synthesize graphene, graphene oxide, and graphene quantum dots for applications of graphene. The company was formerly known as ZEN Graphene Solutions Ltd. and changed its name to Zentek Ltd. in October 2021. Zentek Ltd. was incorporated in 2008 and is headquartered in Thunder Bay, Canada.

How the Company Makes Money

Zentek generates revenue primarily through the commercialization of its graphene-based products and technologies. The company has established various revenue streams, including direct product sales, licensing agreements, and collaborations with industry partners in sectors such as energy and healthcare. Key revenue sources include the sale of its advanced materials for applications in energy storage, filtration systems, and antimicrobial coatings. Additionally, Zentek may engage in research and development partnerships, which can provide funding and shared resources that contribute to its earnings. Significant partnerships with companies and research institutions help bolster its market presence and facilitate the adoption of its innovative technologies.

Zentek Financial Statement Overview

Summary

Zentek faces considerable financial challenges across its income statement, balance sheet, and cash flow statement. The company is struggling with profitability, as evidenced by negative margins and returns. While leverage is low, indicating some financial stability, the lack of profitability and negative cash flows pose significant risks. The company needs to focus on improving operational efficiency and cost management to enhance its financial performance.

Income Statement

Zentek's income statement reveals significant challenges. The company has been struggling with negative profit margins across the board, including gross, net, EBIT, and EBITDA margins. Despite a modest revenue growth rate of 5.995% TTM, the company remains unprofitable, with a net profit margin of -11.51% TTM. The persistent negative margins indicate ongoing operational inefficiencies and cost management issues.

Balance Sheet

The balance sheet shows a relatively low debt-to-equity ratio of 0.046 TTM, suggesting limited leverage and potential financial stability. However, the return on equity is negative at -59.17% TTM, indicating that the company is not generating returns for its shareholders. The equity ratio stands at 75.68% TTM, which is a positive sign of financial stability, but the overall negative ROE highlights profitability challenges.

Cash Flow

Zentek's cash flow statement highlights significant cash flow challenges. The operating cash flow and free cash flow are both negative, with a slight improvement in free cash flow growth of -3.03% TTM. The operating cash flow to net income ratio is -1.80 TTM, indicating that the company is not effectively converting its income into cash. The free cash flow to net income ratio is slightly positive at 1.00 TTM, suggesting some alignment between cash flow and reported earnings, but overall cash flow remains a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	924.80K	872.50K	29.82K	72.86K	339.67K	2.35K
Gross Profit	234.51K	192.49K	-385.06K	-780.48K	-275.04K	-124.44K
EBITDA	-8.14M	-9.35M	-11.08M	-13.75M	-11.27M	-3.73M
Net Income	-8.85M	-10.04M	-11.70M	-14.41M	-38.69M	-3.87M
Balance Sheet
Total Assets	18.48M	18.40M	22.59M	33.29M	37.98M	30.25M
Cash, Cash Equivalents and Short-Term Investments	2.89M	121.48K	3.52M	10.36M	26.68M	3.09M
Total Debt	1.88M	680.47K	1.24M	1.61M	2.23M	404.32K
Total Liabilities	4.49M	3.65M	2.41M	2.90M	3.44M	2.79M
Stockholders Equity	13.99M	14.75M	20.17M	30.38M	34.55M	27.46M
Cash Flow
Free Cash Flow	-6.09M	-6.28M	-8.37M	-15.23M	-11.97M	-2.05M
Operating Cash Flow	-6.04M	-6.28M	-8.05M	-12.96M	-7.99M	-1.79M
Investing Cash Flow	2.69M	358.65K	1.88M	-2.31M	-7.25M	-1.23M
Financing Cash Flow	4.30M	2.52M	-665.47K	-1.05M	38.82M	5.31M

Zentek Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.22
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• 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 Positive. The current price of 1.22 is above the 20-day moving average (MA) of 1.06, above the 50-day MA of 1.20, and below the 200-day MA of 1.55, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 56.89 is Neutral, neither overbought nor oversold. The STOCH value of 38.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ZEN.

Zentek Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
QIPT	66 Neutral	C$154.23M	―	-9.96%	―	-0.70%	-102.48%
MDNA	53 Neutral	C$71.48M	―	-69.80%	―	―	55.80%
Sector *	51 Neutral	$7.90B	-0.36	-43.38%	2.23%	22.34%	-2.15%
ZEN	47 Neutral	$127.75M	―	-53.76%	―	2519.47%	22.52%
ARCH	26 Underperform	C$108.41M	―	90.17%	―	―	10.49%
HITI	―	$285.08M	―	-6.82%	―	―	―
EPRX	45 Neutral	C$271.72M	―	-158.24%	―	―	―

Zentek Corporate Events

Zentek Announces CEO Transition to Drive Commercialization

Zentek Ltd. announced a management transition as the board of directors decided not to extend the consulting contract of CEO Greg Fenton beyond March 31, 2026. The company is actively searching for a successor who will lead Zentek’s shift from research and development to commercialization. The current executive team will manage operations in the interim. This transition is seen as a strategic move to enhance Zentek’s market positioning and drive growth in its commercialization efforts.

Zentek Seeks New Regulatory Pathway for ZenGUARD™ Air Filters

Zentek Ltd. has received a letter from Health Canada regarding the regulatory classification of its ZenGUARD™ Enhanced Air Filters. Previously assessed by the Health Canada Pest Management Regulatory Agency, Zentek withdrew its submission to pursue commercialization as a Class I medical device, similar to its surgical masks. This strategic move aims to streamline the regulatory pathway and enhance market access for its innovative air filtration technology.

Zentek’s ZenGUARD™ Filters Achieve Breakthrough in Viral Filtration

Zentek has announced successful test results for its ZenGUARD™ Enhanced Air Filters, which have demonstrated a significant improvement in viral filtration efficiency compared to standard filters. These results align with ASHRAE Standard 241, which is crucial for controlling infectious aerosols in buildings, offering a practical solution for improving indoor air quality without increasing energy consumption or requiring additional equipment.

Zentek Partners with RSK to Expand Global Reach of ZenGUARD™ Air Filters

Zentek Ltd. has entered into an agency agreement with RSK Environment Ltd., a global environmental consulting firm, to expand the international reach of its ZenGUARD™ Enhanced Air Filters. This partnership will allow RSK to market and promote the air filters in over 20 countries, including the GCC region, with Zentek retaining manufacturing responsibilities. The collaboration aims to accelerate the adoption of the filters in markets prioritizing energy efficiency and indoor air quality, aligning with regional sustainability goals.