Northern Technologies International Corp (NTIC) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E against the industry

Needs positive earnings and enough profitable companies in the industry.

EV/EBITDA above its 5-year median

Northern Technologies International's EV/EBITDA of 24.6 is above its 5-year median of 19.1.

P/B below the industry

Northern Technologies International's price-to-book of 0.97 is below the Fabricated Metal Products, except Machinery and Transportation Equipment median of 2.80.

Trading above fair value

The share price of $7.45 is above our fair value estimate of $4.80.

Margin of safety under 20%

The price is 55.2% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 4.3% a year over the last three fiscal years, short of the 10% we look for.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing slower than the industry

Revenue grew 7.7% over the last twelve months; the Fabricated Metal Products, except Machinery and Transportation Equipment median is 10.2%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin slipping

Gross margin was 35.8% over the last twelve months, against 39.2% a year earlier.

Return on equity under 15%

Return on equity was -1.6% over the last twelve months and averaged 6.6% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 3.3%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

Northern Technologies International's return on equity of -1.6% is below the Fabricated Metal Products, except Machinery and Transportation Equipment median of 9.0%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin below its 5-year average

Net margin was -1.3% over the last twelve months, against a 5-year average of 5.9%.

Net margin below the industry

Northern Technologies International's net margin of -1.3% is below the Fabricated Metal Products, except Machinery and Transportation Equipment median of 4.5%.

Debt level

Needs debt and equity figures.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt coverage

Needs operating cash flow.

Interest not well covered

Operating income covers interest expense 3.5 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 1.72 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 3.27; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Northern Technologies International paid dividends worth 0.1% of the share price over the last twelve months.

Yield below Treasuries

The 0.1% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Northern Technologies International yields 0.1%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 9 fiscal years.

Earnings cover

Needs dividends paid and net income.

Cash-flow cover

Needs dividends paid and free cash flow.