Roth Capital Markets analyst Gerry Sweeney maintained a “Buy” rating and $3.00 price target on Loop Industries (Loop Industries Stock Quote, Chart, News, Analysts, Financials NASDAQ:LOOP) in a June 9 earnings report, citing progress on its India joint venture with Ester and early funding milestones in its European partnership with Reed (SocGen).
“Our target is based on 5.5x our Adjusted EBITDA estimate of $23.5mm in F2028 discounted back at 15%,” Sweeney said. “We assume approximately 61.7mm shares outstanding and $116mm of debt (LOOP’s portion of the debt held at the JV level based on two Indian facilities). We have increased our discount rate, which precipitated a lower price target due to tight balance sheet conditions.”
Loop Industries is a Canadian technology company that uses patented methods to break down low-value PET plastic waste into basic materials, which it then turns into high-quality, food-grade plastic and polyester.
Loop reported Q4 fiscal 2025 revenue of $10.8-million, including $10.4-million in licensing revenue from its first technology license with Reed Société Générale Group to build an Infinite Loop facility in Europe—a key milestone for the company.
“Additionally, LOOP will receive another €10mm in licensing fees based on the successful achievement of project milestones,” Sweeney said. “This deal was closed in December 2024 – please see our note HERE.
“On the engineering side, LOOP entered into an agreement with its India JV, Ester Loop Infinite Technologies (ELITe), to provide engineering services to the JV. This resulted in 4Q revenue of $0.4mm. For F2026, LOOP expects to generate additional revenue from ELITe of $1.0mm with $0.2mm anticipated in 1Q.”
Sweeney said Loop is making progress on several PET technology projects, with the India joint venture with Ester leading the way and expected to cost $176-million to build and commercialize.
“These costs should provide a very attractive return,” he said. “The next marker for LOOP will likely be providing details around the financing package (debt/project finance) in the coming months. This should allow the project to begin construction toward the end of 2026, which represents a major milestone for the company. We anticipate engineering revenue to offset costs for LOOP (in addition to overall expense management). Finally, the Reed (SocGen) JV provided a needed infusion of cash ($10.4mm) with further milestone opportunities available in the coming 12–18 months.”
Loop plans to break ground on its India project in the second half of 2025, with construction finishing in late 2026 and operations starting in 2027. Total project costs are estimated at $176-million.
“LOOP and its JV partner Ester selected the Gujarat province as the location for the facility,” Sweeney said. “Gujarat provides several operating benefits, which include access to renewable energy, seaport access, and proximity to the Surat region. Surat is the main hub for polyester textile production in India, providing access to production demand and waste polyester for recycling. Upon completion, LOOP expects the facility to have an annual production capacity of 70,000 MT. Taking into account the ramp-up period, management expects to achieve full output capacity by early 2028.”
Sweeney expects Loop to report an Adjusted EBITDA loss of $12.8-million on $10.9-million in revenue for fiscal 2025, an improvement from his earlier estimate of a $23.8-million loss. For fiscal 2026, he forecasts a narrower loss of $10.0-million on just $1.0-million in revenue, slightly better than the prior estimate of a $12.0-million loss.
As of February 28, 2025, Loop had $13-million in cash and $15.4-million in total liquidity, including $2.4-million from its credit line. It received $10.4-million of a $20.8-million funding deal with Reed, with the second half expected by late 2025 or early 2026. Key cash uses included debt repayment, a contribution to the India JV, and $2.6-million in operating expenses, which were down $2.1-million from the prior year. Management expects lower operating costs in the second half of 2025.
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About The Author /
Rod Weatherbie is a journalist based in Prince Edward Island. Since 2004, he has written extensively about the Canadian property and casualty insurance landscape. He was also a founder and contributing editor for a Toronto-based arts website and a PEI-based food magazine. His fiction and poetry have been featured in The Fiddlehead, The Antigonish Review, and Juniper.
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