5N Plus (VNP) AI Stock Analysis

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5N Plus

(TSX:VNP)

60Neutral

5N Plus exhibits strong growth in revenue and operational efficiency, driven by strategic expansions and market demand. However, the stock faces technical challenges and cash flow management issues, along with moderate valuation concerns. The robust earnings performance and corporate events highlight the company's potential, but global economic uncertainties and debt levels pose risks.

5N Plus (VNP) vs. S&P 500 (SPY)

Market Cap

C$528.02M

Dividend YieldN/A

Average Volume (3M)342.52K

Price to Earnings (P/E)26.3

Beta (1Y)0.81

Revenue Growth21.14%

EPS Growth-3.80%

CountryCA

Employees793

SectorBasic Materials

Sector Strength58

IndustryChemicals - Specialty

Share Statistics

EPS (TTM)0.23

Shares Outstanding89,042,800

10 Day Avg. Volume229,942

30 Day Avg. Volume342,522

Financial Highlights & Ratios

PEG Ratio0.12

Price to Book (P/B)N/A

Price to Sales (P/S)1.17

Price to Cash Flow (P/CF)-27.80

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

C$10.00

Price Target Upside88.32% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering0

5N Plus Business Overview & Revenue Model

Company Description5N Plus Inc. is a leading producer of specialty semiconductors and performance materials. The company operates in two main sectors: Electronic Materials and Eco-Friendly Materials. Its core products and services include the manufacturing and supply of high-purity metals, chemicals, and engineered materials that are critical for applications in the renewable energy, healthcare, aerospace, and industrial sectors.

How the Company Makes Money5N Plus generates revenue primarily through the sale of its high-purity metals and performance materials to various industries. The Electronic Materials sector focuses on products for the solar power and electronics industries, providing essential components for photovoltaic cells and other semiconductor applications. The Eco-Friendly Materials sector supplies materials that are crucial for environmental technologies, such as those used in emissions control and renewable energy solutions. The company leverages strategic partnerships and long-term supply agreements with key customers to ensure stable revenue streams. Additionally, 5N Plus invests in research and development to innovate and enhance its product offerings, which can lead to new revenue opportunities.

5N Plus Financial Statement Overview

Summary

5N Plus shows a promising revenue growth and strong operational efficiency, but struggles with cash flow management and moderate leverage risks. Improvement in cash flow stability is crucial for financial health.

Income Statement

Positive

5N Plus has demonstrated a consistent revenue growth with a 19.37% increase from 2023 to 2024, indicating a positive trajectory. The gross profit margin of 26.92% in 2024 is healthy, and the net profit margin improved from 6.35% to 5.07%. However, the net profit margin declined slightly, which could be a concern. The EBIT and EBITDA margins are strong at 11.14% and 17.22% respectively, showcasing robust operational efficiency.

Balance Sheet

Positive

The company's debt-to-equity ratio increased slightly to 1.09 in 2024, reflecting a moderate level of leverage which could pose a risk if not managed properly. The return on equity (ROE) is 10.55%, indicating decent shareholder returns. The equity ratio stands at 36.89%, which suggests a balanced capital structure but highlights potential vulnerability to high leverage.

Cash Flow

Neutral

5N Plus faced challenges in cash flow management with a negative free cash flow of -$28.07 million in 2024. The operating cash flow to net income ratio is negative, reflecting cash flow issues. Despite these challenges, the company has shown resilience in financing activities, offsetting some cash flow deficits.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
289.28M	242.37M	264.22M	209.99M	177.19M
	Gross Profit
77.87M	57.54M	48.51M	38.78M	36.39M
	EBIT
32.23M	27.37M	-12.78M	12.87M	13.50M
	EBITDA
49.82M	43.88M	5.17M	25.24M	25.22M
	Net Income Common Stockholders
14.67M	15.40M	-23.00M	3.11M	2.19M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
22.14M	34.71M	42.69M	35.94M	39.95M
	Total Assets
376.91M	350.20M	347.99M	373.59M	226.68M
	Total Debt
151.60M	138.64M	151.40M	148.64M	55.47M
	Net Debt
129.46M	103.93M	108.71M	112.70M	15.52M
	Total Liabilities
237.89M	221.61M	235.21M	237.34M	108.30M
	Stockholders Equity
139.02M	128.59M	112.78M	136.25M	118.38M
Cash Flow		Free Cash Flow
-28.07M	-992.00K	6.69M	4.34M	28.25M
	Operating Cash Flow
-6.89M	17.25M	23.74M	10.27M	36.80M
	Investing Cash Flow
-17.98M	-12.36M	-18.99M	-49.93M	-8.46M
	Financing Cash Flow
12.39M	-13.00M	2.41M	36.22M	-8.80M

5N Plus Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price5.31

Price Trends

50DMA

6.31

Negative

100DMA

6.72

Negative

200DMA

6.62

Negative

Market Momentum

MACD

-0.34

Negative

RSI

35.32

Neutral

STOCH

34.74

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:VNP, the sentiment is Neutral. The current price of 5.31 is below the 20-day moving average (MA) of 5.40, below the 50-day MA of 6.31, and below the 200-day MA of 6.62, indicating a neutral trend. The MACD of -0.34 indicates Negative momentum. The RSI at 35.32 is Neutral, neither overbought nor oversold. The STOCH value of 34.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:VNP.

5N Plus Peers Comparison

Overall Rating

UnderperformOutperform

Sector (47)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HBM	66 Neutral	$3.57B	32.38	3.30%	0.24%	19.70%	9.24%
LUN	64 Neutral	$8.24B	25.63	0.24%	3.80%	-2.71%	-188.94%
FM	63 Neutral	$13.01B	―	0.02%	―	-24.38%	99.06%
VNP	60 Neutral	C$528.02M	26.31	10.84%	―	21.14%	-3.80%
IVN	51 Neutral	$15.08B	45.30	5.25%	―	―	-33.54%
Sector *	47 Neutral	$2.32B	-2.83	-21.67%	3.65%	4.83%	-28.82%
TK	37 Underperform	C$20.43M	―	-1.26%	―	―	35.14%

* Basic Materials Sector Average

Performance Comparison

TSE:VNP

5N Plus

5.93

1.09

22.52%

TSE:HBM

Hudbay Minerals

9.78

-0.91

-8.50%

TSE:FM

First Quantum Minerals

16.95

0.89

5.54%

TSE:IVN

Ivanhoe Mines

12.15

-6.05

-33.24%

TSE:LUN

Lundin Mining

9.17

-6.21

-40.37%

TSE:TK

Tinka Resources

0.04

-0.10

-71.43%

5N Plus Earnings Call Summary

Earnings Call Date: Feb 25, 2025 | % Change Since: -23.38% | Next Earnings Date: May 13, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance, particularly in the Specialty Semiconductors segment, with significant revenue and adjusted EBITDA growth. However, concerns about global economic uncertainty and its potential impact on costs and trade were noted. While the Performance Materials segment showed flat revenue, the overall momentum and strategic positioning in high-growth sectors are positive.

Highlights

Record Annual Adjusted EBITDA

5N Plus reported an annual adjusted EBITDA of $53.3 million, which is a 39% increase from the previous record year.

Revenue Growth

Total revenue in 2024 reached $289.3 million, representing a healthy 19% increase over 2023.

Specialty Semiconductors Segment Performance

The Specialty Semiconductors segment saw revenue growth to $202.3 million from $156.5 million in 2023, driven by high demand from terrestrial renewable energy and space solar power sectors.

Capacity Expansion Achievements

New semiconductor compound capacity in Montreal tripled from 2022 levels. Space solar cell production capacity at AZUR in Heilbronn increased by 35% over 2022 levels.

Strong Backlog

Specialty Semiconductors had a backlog representing 365 days, indicating strong demand and long-term contracts.

Lowlights

Potential Impact of Global Economic Uncertainty

Uncertainty due to trade environment changes and U.S. Presidential orders may lead to inflation and other cost-related impacts.

Flat Revenue in Performance Materials

Performance Materials segment revenue was largely flat, showing minor decreases in certain areas.

Increased Net Debt

Net debt increased to $100.1 million from $73.8 million, reflecting higher working capital and capital expenditures.

Company Guidance

During the Q4 2024 earnings call, 5N Plus Inc. reported strong financial metrics, highlighting a 39% increase in annual adjusted EBITDA to $53.3 million, surpassing previous records. The company's revenue for 2024 reached $289.3 million, a 19% increase over 2023, with Q4 revenue growing by 9% to $70.9 million. The adjusted gross margin for the year was 31.6%, up from 24.3% in 2023. The Specialty Semiconductors segment showed significant growth, with Q4 revenue increasing to $51.9 million, supported by high demand from the terrestrial renewable energy and space solar power sectors. The adjusted EBITDA for this segment rose by 69% in Q4 to $12.6 million. The Performance Materials segment also maintained strong margins, with a full-year adjusted EBITDA increase of $1 million to $22.1 million. The company ended the year with a net debt of $100.1 million and a net debt to EBITDA ratio of 2. For 2025, 5N Plus revised its adjusted EBITDA guidance upward to a range of $55 million to $60 million, reflecting strong demand and strategic growth initiatives but deferred 2026 guidance due to global economic uncertainties.

5N Plus Corporate Events

Private Placements and FinancingBusiness Operations and Strategy

5N Plus Expands Credit Facilities to Fuel Growth

Positive

Apr 1, 2025

5N Plus Inc. has renewed its syndicated credit facilities, increasing its borrowing capacity from $124 million to $154 million, with the potential to further expand to $204 million. This financial move is designed to support the company’s growth strategy, focusing on value-added products and long-term customer partnerships. The oversubscribed credit facility, led by the Royal Bank of Canada and other financial institutions, underscores the confidence in 5N Plus’s market positioning as a leading supplier of critical specialty semiconductors.

Business Operations and StrategyFinancial Disclosures

5N Plus Inc. Achieves Record Financial Growth in FY 2024

Positive

Feb 25, 2025

5N Plus Inc. reported a 19% increase in annual revenue to $289.3 million and a 39% growth in annual Adjusted EBITDA to a record $53.3 million for fiscal year 2024. The company has successfully expanded its capacity at several sites, including a 30% increase in solar cell capacity at AZUR, and continues to benefit from its strategic focus on high-margin, value-added materials. As a trusted partner and market leader outside China, 5N Plus is well-positioned to leverage its competitive advantages and maintain its momentum into 2025.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.