Zentek (ZEN) AI Stock Analysis

• Market Cap: $131.94M
• Dividend Yield: N/A
• Average Volume (3M): 52.57K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.09
• Revenue Growth: 2519.47%
• EPS Growth: 22.52%
• Country: CA
• Employees: 24
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Instruments & Supplies
• EPS (TTM): -0.01
• Shares Outstanding: 104,710,460
• 10 Day Avg. Volume: 37,940
• 30 Day Avg. Volume: 52,571
• 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: 1.16
• Enterprise Value/Revenue: 165.14
• Enterprise Value/Gross Profit: 651.23
• Enterprise Value/Ebitda: -18.76
• 1Y Price Target: $1.50
• Price Target Upside: 19.35% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 46 Neutral
• Price Target: C$1.50 ▲(19.05% Upside)

Zentek's overall stock score is primarily impacted by its weak financial performance, characterized by negative profitability and cash flow challenges. While technical analysis shows some neutral to slightly positive momentum, the valuation remains unattractive due to the negative P/E ratio. The absence of earnings call data and corporate events means these factors did not influence the score.

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: Neutral
• Last Price: 1.26
• 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 Neutral. The current price of 1.26 is above the 20-day moving average (MA) of 1.16, above the 50-day MA of 1.17, and below the 200-day MA of 1.54, indicating a neutral trend. The MACD of 0.04 indicates Negative momentum. The RSI at 53.66 is Neutral, neither overbought nor oversold. The STOCH value of 48.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:ZEN.

Zentek Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HITI	66 Neutral	468.47M	-44.39	-3.03%	―	11.18%	70.04%
QIPT	66 Neutral	162.05M	-11.16	-6.31%	―	-0.70%	-102.48%
MDNA	53 Neutral	68.73M	-6.05	0.00%	―	0.00%	55.80%
ZEN	46 Neutral	$131.94M	―	-53.76%	―	2519.47%	22.52%
EPRX	45 Neutral	300.58M	-6.97	0.00%	―	0.00%	0.00%
ARCH	26 Underperform	109.74M	-45.23	0.00%	―	0.00%	10.49%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Zentek Corporate Events

Zentek Updates Board Nominees with New Expertise

Zentek Ltd. has announced an updated slate of independent director nominees for its upcoming annual general and special meeting. The new nominees include Matt Fontes and Pete Gettinby, who bring expertise in building innovation and renewable energy, respectively. This strategic update aims to enhance Zentek’s board with diverse skills and experiences, potentially strengthening its market position and operational capabilities.

The most recent analyst rating on (TSE:ZEN) stock is a Hold with a C$1.50 price target. To see the full list of analyst forecasts on Zentek stock, see the TSE:ZEN Stock Forecast page.

Zentek’s Albany Graphite Corp. Secures $500,000 Grant for Purification Project

Albany Graphite Corp., a subsidiary of Zentek Ltd., has been awarded a $500,000 grant from Ontario’s Critical Minerals Innovation Fund for its graphite purification and anode material development project. This initiative, which involves collaboration with North American companies and Natural Resources Canada, aims to enhance the production of ultra-high purity graphite for applications in lithium-ion batteries and nuclear technology, potentially strengthening Zentek’s position in the critical minerals market.

The most recent analyst rating on (TSE:ZEN) stock is a Sell with a C$1.00 price target. To see the full list of analyst forecasts on Zentek stock, see the TSE:ZEN Stock Forecast page.