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Northern Technologies International (NTIC)
NASDAQ:NTIC
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Northern Technologies International
(NASDAQ:NTIC)
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Rating:67Neutral
Price Target:
$8.00
▲(4.03% Upside)
NTIC's overall stock score reflects strong financial stability and profitability, offset by challenges in revenue growth and cash flow management. The technical analysis suggests a bearish trend, while the valuation indicates potential overvaluation. The earnings call provides a mixed outlook with strategic investments and market expansion efforts.
Northern Technologies International (NTIC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$73.62M
Dividend Yield2.05%
Average Volume (3M)16.97K
Price to Earnings (P/E)25.9
Beta (1Y)0.06
Revenue Growth3.46%
EPS Growth-34.80%
CountryUS
Employees262
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)0.02
Shares Outstanding9,474,363
10 Day Avg. Volume18,276
30 Day Avg. Volume16,970
Financial Highlights & Ratios
PEG Ratio0.28
Price to Book (P/B)1.82
Price to Sales (P/S)1.52
P/FCF Ratio52.43
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue0.90
Enterprise Value/Gross Profit2.30
Enterprise Value/Ebitda10.86
Forecast
1Y Price Target
$8.00Price Target Upside4.03% Upside
Rating ConsensusHold
Number of Analyst Covering0
Northern Technologies International Business Overview & Revenue Model
Company DescriptionNorthern Technologies International Corporation develops and markets rust and corrosion inhibiting products and services in North America, South America, Europe, Asia, the Middle East and internationally. It offers rust and corrosion inhibiting products, such as plastic and paper packaging, liquids, coatings, rust removers, cleaners, diffusers, and engineered solutions designed for the oil and gas industry under the ZERUST brand. The company also provides a portfolio of bio-based and certified compostable polymer resin compounds and finished products under the Natur-Tec brand. In addition, it offers on-site and technical consulting for rust and corrosion prevention issues. The company sells its products and services to automotive, electronics, electrical, mechanical, military, retail consumer, and oil and gas markets through direct sales force, network of independent distributors and agents, manufacturer's sales representatives, strategic partners, and joint venture. Northern Technologies International Corporation was founded in 1970 and is headquartered in Circle Pines, Minnesota.
How the Company Makes MoneyNTIC generates revenue through the sale of its proprietary products and technologies, which include corrosion inhibitors, packaging materials, and surface treatment solutions. The company has established key revenue streams from both direct product sales and licensing agreements, where it licenses its patented technologies to other manufacturers. Additionally, NTIC benefits from strategic partnerships with major industrial companies and distributors, expanding its market reach and enhancing its product offerings. The company's commitment to innovation and sustainability also attracts government contracts and grants, further contributing to its earnings.
Northern Technologies International Earnings Call Summary
Earnings Call Date:Jul 10, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with notable achievements in net sales growth and gross margin improvement, particularly in the Chinese market, contrasting with challenges in joint venture sales, reduced net income, and increased operating expenses. Strategic investments and market expansion efforts in oil and gas and bioplastics indicate potential future growth but are currently impacting profitability.Q3-2025 Updates
Positive Updates
Overall Net Sales Growth
Consolidated net sales increased by 4% to $21.5 million for the third quarter of fiscal 2025 compared to the same period last year.
Gross Margin Improvement
Gross margin reached 38.4%, increasing both sequentially and year-over-year, indicating a more profitable sales mix and efficiency improvements.
NTSC China Sales Surge
NTSC China achieved a 27.4% increase in net sales to $4.5 million, the second highest quarterly revenue since transitioning to a wholly-owned subsidiary.
ZERUST Oil and Gas Trailing Twelve-Month Sales Increase
ZERUST Oil and Gas sales grew 15.4% over the trailing twelve-month period, reflecting successful investments in team and resource expansion.
Negative Updates
Joint Venture Sales Decline
Joint venture sales decreased by 12.9% year-over-year to $2.3 million, primarily due to high energy prices and regional economic pressures in Europe.
Decreased Net Income and Adjusted Net Income
Net income dropped to $122,000 from $977,000, and non-GAAP adjusted net income fell to $228,000 from $1.1 million compared to the same quarter last year.
Increased Operating Expenses
Operating expenses increased 7.6% to $9.7 million, influenced by personnel costs and strategic investments in the oil and gas sector.
Decreased Natur Tec Sales
Natur Tec sales decreased by 1.2% year-over-year, although they showed a sequential improvement of 16.5%.
Company Guidance
During the NTIC third quarter fiscal 2025 earnings call, the company reported a 4% increase in consolidated net sales, reaching $21.5 million, despite macroeconomic challenges. Key financial metrics included a gross margin of 38.4%, a slight improvement from the previous year, and operating expenses rising by 7.6% to $9.7 million. The net income for the quarter was $122,000, or 1¢ per diluted share, down from $977,000, or 10¢ per diluted share, in the previous year. NTIC also observed a 27.4% increase in sales at its NTSC China subsidiary, totaling $4.5 million. Meanwhile, joint venture sales declined by 12.9% to $2.3 million, influenced by high energy prices and economic pressures in Europe. The company highlighted a 15.4% year-over-year increase in trailing twelve-month sales for its ZERUST Oil and Gas segment, although quarterly sales dipped slightly to $1.3 million. Natur Tec sales saw a 1.2% decline, but a 16.5% sequential increase. NTIC's cash and cash equivalents stood at $6.8 million, with outstanding debt of $10.1 million, including $7.4 million under its revolving line of credit. The call emphasized continued strategic investments in oil and gas and bioplastics, particularly in China, as part of its long-term growth focus.Northern Technologies International Financial Statement Overview
Summary
NTIC shows strong profitability margins and prudent leverage with a low debt-to-equity ratio. However, revenue growth is slightly declining, and cash flow management needs improvement to enhance financial flexibility.Income Statement
NTIC's TTM revenue shows a slight decrease compared to the previous annual report. However, the company maintains a healthy gross profit margin of 39.2% and a net profit margin of 4.5% for the TTM period, indicating strong cost management. The EBIT and EBITDA margins are 6.0% and 5.2% respectively, reflecting moderate operational efficiency.75
Positive
Balance Sheet
The company's debt-to-equity ratio is low at 0.07, indicating conservative leverage. The return on equity (ROE) is modest at 5.2% based on TTM data, but the equity ratio is strong at 78.8%, highlighting a solid equity base and financial stability.80
Positive
Cash Flow
NTIC's free cash flow growth rate is challenging to assess due to fluctuations in capital expenditures. The operating cash flow to net income ratio is 0.90, which is reasonable. However, the free cash flow to net income ratio is lower at 0.21, suggesting potential cash flow constraints.68
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 85.27M | 85.06M | 79.90M | 74.16M | 56.49M | 47.64M |
| Gross Profit | 33.44M | 33.79M | 27.80M | 23.07M | 19.57M | 16.03M |
| EBITDA | 7.09M | 9.74M | 1.20M | 1.99M | 1.97M | -1.61M |
| Net Income | 2.95M | 5.41M | 2.91M | 6.32M | 6.28M | -934.76K |
Balance Sheet | ||||||
| Total Assets | 99.30M | 94.68M | 89.34M | 86.19M | 74.37M | 66.07M |
| Cash, Cash Equivalents and Short-Term Investments | 6.77M | 4.95M | 5.41M | 5.34M | 7.69M | 11.95M |
| Total Debt | 7.45M | 7.54M | 6.79M | 6.46M | 376.44K | 658.79K |
| Total Liabilities | 22.73M | 19.50M | 18.65M | 18.95M | 8.62M | 6.37M |
| Stockholders Equity | 72.36M | 71.19M | 66.36M | 63.60M | 62.37M | 56.66M |
Cash Flow | ||||||
| Free Cash Flow | -199.34K | 2.46M | 2.18M | -557.75K | -2.75M | 4.10M |
| Operating Cash Flow | 2.11M | 5.88M | 5.54M | 1.15M | 2.89M | 4.91M |
| Investing Cash Flow | -4.20M | -3.42M | -3.34M | -7.11M | -103.32K | -2.78M |
| Financing Cash Flow | 3.09M | -2.96M | -2.05M | 3.19M | -1.52M | -1.52M |
Northern Technologies International Technical Analysis
Neutral
7.69
Price Trends
7.64
Positive
7.67
Positive
9.04
Negative
Market Momentum
0.04
Negative
50.73
Neutral
35.83
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTIC, the sentiment is Neutral. The current price of 7.69 is below the 20-day moving average (MA) of 7.78, above the 50-day MA of 7.64, and below the 200-day MA of 9.04, indicating a neutral trend. The MACD of 0.04 indicates Negative momentum. The RSI at 50.73 is Neutral, neither overbought nor oversold. The STOCH value of 35.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NTIC.
Northern Technologies International Risk Analysis
Northern Technologies International disclosed 55 risk factors in its most recent earnings report. Northern Technologies International 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
Northern Technologies International Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $107.20M | 37.76 | 8.06% | ― | -1.52% | 6.38% | |
67 Neutral | $73.62M | 25.86 | 4.18% | 2.05% | 3.46% | -34.80% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
48 Neutral | $19.91M | ― | -119.89% | ― | 36.89% | 91.74% | |
46 Neutral | $78.26M | ― | -406.97% | ― | 8400.76% | 31.02% | |
45 Neutral | $86.69M | ― | -28.22% | ― | -12.70% | -74.32% | |
45 Neutral | $67.95M | ― | 103.25% | 1.95% | -7.97% | 13.42% |
* Basic Materials Sector Average
NTIC
Northern Technologies International
7.69
-4.81
-38.48%
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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.