[Qiltrack AI] N2OFF Inc (NITO) 3-Minute Overview

This report is auto-generated by an AI stock research platform for informational purposes only. The content is for general information and research reference, and does not constitute financial advice. Data may lag or be incomplete. Always conduct your own research and consult qualified professionals before making any financial decisions. # [Qiltrack AI] N2OFF Inc (NITO) 3-Minute Overview > **💡 One-Sentence Summary** > > N2OFF is a tiny, high-risk Israeli chemicals company whose share price has crashed, with very high gross margins on paper but massive losses and a very fragile business model. > **📍 Basic Profile** > > Market Cap **~$4.6 million** · Chemicals · NASDAQ · Price **$1.65** --- > **⚡ 3 Things You Should Know** > > 1. ⚠️ **Extreme collapse & micro-cap:** The stock is trading almost at its 52-week low and is down ~97%+ from its 52-week high, with a market cap of only a few million dollars—this is firmly in “speculative micro-cap” territory where liquidity and volatility are big issues. > > 2. 🔥 **Great gross margin, terrible overall economics:** Gross margin is high (~66%), which means the core product is priced well, but net margin is about **-1,025%** and ROE about **-114%**—the company is burning far more money than it brings in, likely due to very small revenue and heavy overhead. > > 3. 💸 **Cash-rich but value-destructive:** The balance sheet shows **no debt** and strong liquidity (current ratio ~4.2, quick ratio ~3.3), so it’s not overlevered; but if these losses continue, the main risk is equity dilution or even business viability, not bankruptcy from debt. --- > **🎯 Quick Health Check** > > | Dimension | Rating | Details | > |------------------|---------------------|---------| > | Profitability | Weak👎 | Gross margin ~66%, but net margin ~-1,025% and ROE ~-114% (deeply loss-making) | > | Growth Rate | Slow🐢 | 3-year revenue growth about **-22%**; 5-year barely positive (~3%) → business shrinking recently | > | Financial Health | Healthy💚 | Current ratio ~4.2, no debt (debt-to-equity 0), but negative interest coverage (operating losses) | > | Valuation | Fair / Speculative | No PE (loss-making); P/S very high (~21x) but P/B low (~0.57x) → mixed signals, highly speculative | --- ## 📋 Layer 2: 2-Minute Deep Dive ### 📊 How Does This Company Make Money? **Business Model in One Sentence:** A very small Israeli chemicals company selling high-margin products, but currently on a tiny revenue base with operating expenses that massively exceed sales. **Revenue Breakdown:** *(no segment data available)* | Business | Share | Trend | Comment | |-------------------|-------|-------|---------| | Core operations | 100% | ↓ | 3-year revenue growth about -22% suggests revenue has been shrinking rather than scaling | **Profitability Metrics:** | Metric | Value | Ranking | Interpretation | |---------------|------------|------------------|----------------| | Gross Margin | ~66.2% | High vs typical chemicals | The direct unit economics of the product look attractive; production itself isn’t the problem. | | Net Margin | ~-1,024.7% | Extremely weak | For every $1 of sales, the company is losing about $10 at the bottom line—tiny revenue plus heavy overhead and/or one-offs. | | ROE (TTM) | ~-113.7% | Extremely weak | The company is destroying shareholder equity at a very fast pace. | --- ### 📈 How's the Growth? **Growth Assessment:** **Slowing / Shrinking** | Metric | Latest | vs Last Year | Trend | |-----------------|--------|--------------|-------| | Revenue Growth | [Data unavailable] | [Data unavailable] | 3-year CAGR about **-21.9%** → revenue has been declining overall | | Profit Growth | [Data unavailable] | [Data unavailable] | EPS is negative; last two quarters still loss-making, though the loss per share narrowed | **Growth Quality (plain English):** Based on the data: - Over **5 years**, revenue growth is only about **+3%** total (basically flat). - Over the **last 3 years**, revenue is down about **22% per year on average** → that’s a clear contraction. - EPS (per quarter) went from **-0.39** to **-0.18** recently, so losses narrowed, but we don’t know if that’s a real turnaround or just noise. In other words: the company isn’t a growth story right now; it’s more like a shrink-and-try-to-survive story. --- ### 💰 Financial Health Check **One Sentence:** No debt and plenty of current assets versus liabilities, but the business is “living off the balance sheet” while operations lose money. | Metric | Value | Safe Zone | Assessment | |-------------------|---------|-----------|------------| | Debt Ratio | 0 (D/E) | <60% | ✅Safe – no financial leverage risk right now | | Current Ratio | ~4.21 | >1.5 | ✅Safe – has several times more current assets than short-term liabilities | | Quick Ratio | ~3.27 | >1.0 | ✅Comfortable – even without inventory, liquidity looks strong | | Interest Coverage | ~-2.9 | >3 | ⚠️Problem – operating loss can’t cover interest costs; operations themselves are not self-sustaining | | Cash Flow | [Data unavailable] | >0 | [Data unavailable, but losses imply likely negative operating cash flow] | So while the **balance sheet isn’t overlevered**, continued big losses will eventually eat into that cushion; at some point, they’d likely need to issue equity or cut back sharply. --- ### 🏷️ Is It Expensive Now? **Price Position (based on 52-week range):** - 52-Week Low: **$1.40** - 52-Week High: **$53.55** - Current: **$1.65** → **very close to the low** (roughly ~1% above the bottom of the range) So the stock has already been crushed, but that alone doesn’t guarantee it’s “cheap” in a fundamental sense. | Position Range | Cheap Zone | Fair Zone | Pricey Zone | |----------------|------------|-----------|-------------| | Criteria | 0–33% | 33–66% | 66–100% | | **Current** | ● (~1%) | | | **Valuation Comparison:** | Comparison | Current | Reference | Assessment | |----------------|-------------------------------|---------------------------|------------| | vs Own History | PE: N/A (loss-making) | 5-year avg: [Data unavailable] | Hard to compare – no positive earnings history in dataset | | vs Peers | P/S ~21.1x, P/B ~0.57x | Industry P/S often ~1–3x, P/B ~1–2x (typical chemicals) | Expensive vs sales, cheap vs book; market may be doubting the book value and business viability | **What the Current Valuation is Betting On:** At ~**0.6x book** but **~21x sales**, the market seems to be saying: - “We don’t fully trust the balance sheet or long-term earnings power” (hence low P/B). - But also, “If this business can survive and scale using that high gross margin, sales could one day support profits” (keeping some value on the remaining revenue). In plain terms: the current price is basically a **speculative bet on a turnaround** from massive losses to something sustainable. --- ### 📰 Any Recent News? | Date | Event | Impact | |------|-------|--------| | [Data unavailable] | No recent news in the provided dataset | Neutral – you’d need to check external sources (SEC filings, press releases) for the latest updates | --- ## 📊 Layer 3: 3-Minute Complete Analysis ### I. Detailed Financial Data **Profitability Trends:** *(TTM = latest 12 months)* | Metric | This Year (TTM) | Last Year | Year Before | 3-Year Trend | |-------------|------------------|-----------|-------------|--------------| | Gross Margin | ~66.2% | [Data unavailable] | [Data unavailable] | N/A | | Net Margin | ~-1,024.7% | [Data unavailable] | [Data unavailable] | N/A (but clearly deeply negative now) | | ROE | ~-113.7% | [Data unavailable] | [Data unavailable] | N/A (currently very value-destructive) | **Growth Trends:** | Metric | This Year | Last Year | Year Before | 3-Year Trend | |----------------|-----------|-----------|-------------|--------------| | Revenue Growth | [Data unavailable] | [Data unavailable] | [Data unavailable] | 3-year CAGR about **-21.9%** (shrinking) | | Profit Growth | [Data unavailable] | [Data unavailable] | [Data unavailable] | EPS negative; most recent quarters show losses, but one quarter improved vs previous | | EPS Growth | [Data unavailable] | [Data unavailable] | [Data unavailable] | N/A (insufficient history in dataset) | --- ### II. Earnings Track Record **Last 4 Quarters vs Expectations:** *(only 2 quarters provided)* | Quarter End | EPS Expected | EPS Actual | Surprise | |---------------|--------------------|------------|----------| | 2025-06-30 | [Data unavailable] | -0.18 | [Data unavailable] | | 2025-03-31 | [Data unavailable] | -0.39 | [Data unavailable] | | [Earlier] | [Data unavailable] | [Data unavailable] | [Data unavailable] | | [Earlier] | [Data unavailable] | [Data unavailable] | [Data unavailable] | **Earnings Trend Interpretation:** We only see: - Still **loss-making** each quarter. - Loss per share **improved** from -0.39 to -0.18 in the latest quarter. Without more history, it’s unclear if that’s the start of a true turnaround or just quarter-to-quarter noise; but it does show management can at least reduce burn in the short term. --- ### III. What the Market Thinks **Analyst Ratings:** *(none in dataset)* | Rating | Count | Percentage | |------------------|-------|------------| | Strong Buy/Buy | [Data unavailable] | [Data unavailable] | | Hold | [Data unavailable] | [Data unavailable] | | Sell | [Data unavailable] | [Data unavailable] | **Target Price:** [Data unavailable] **vs Current Price:** [Data unavailable] There’s likely **little or no mainstream analyst coverage**, which is typical for micro-caps of this size. **Insider Activity:** Net insider activity over last 3 months: **[Data unavailable]** - No data here, so we can’t say if insiders are buying the dip or cashing out. - For such a small company, insider moves (if any) would be important to watch separately via filings. --- ### IV. Key Risk Alerts 1. **Business Viability Risk:** Net margin around **-1,025%** and ROE around **-114%** mean the business model, at its current scale, is not working. → If they can’t grow revenue meaningfully or slash costs, continued losses could force painful restructuring, fire sales of assets, or eventual delisting. 2. **Dilution & Funding Risk:** With **no debt** but ongoing losses, the most likely way to keep going is **raising more equity** or similar instruments. → That could mean **significant dilution** for existing shareholders, especially at a depressed share price. 3. **Micro-cap & Volatility Risk:** With a market cap of roughly **$4–5 million** and beta around **2.6**, the stock is both **thinly traded and highly volatile**. → Bid-ask spreads can be wide, prices can swing hard on little news, and it may be hard to exit large positions without moving the price. (Additional background risk: it’s an Israeli company, so there can be **geopolitical risk** on top of company-specific issues.) --- ## 🎬 Summary & Next Steps > **📝 Three-Sentence Summary** > > **What it is:** N2OFF is an ultra-small Israeli chemicals company with high gross margins but currently tiny, shrinking revenue and very heavy losses. > **Key strength:** The balance sheet has no debt and solid liquidity, giving it some time to attempt a turnaround using those attractive unit economics. > **Key risk:** Profitability and growth are both extremely weak, so shareholders face real risks of further value destruction and dilution if the business can’t quickly move toward sustainable scale. --- > **🔍 Want to Learn More?** > > • Curious if this company has any durable competitive edge or moat? → Try **【Buffett Mode】** to dissect its business model and competitive position. > • Worried about hidden landmines like going-concern warnings or dilution plans? → Try **【Muddy Mode】** for a focused risk screening. > • Thinking of it as a high-risk turnaround/growth bet? → Try **【Musk Mode】** to stress-test optimistic scenarios and see what would need to go right.