SenesTech (SNES), which sells rat fertility-suppression products, reported excellent Q3 progress on Nov. 10, with revenue up +43.2% YoY and +10.4% QoQ. There are many catalysts for this company, which could make SNES stock worth buying.

For example, along with the release, SenesTech announced it is now selling its main product, Evolve, on Lowes.com (LOW). That complements its other e-commerce sales on Amazon.com (AMZN), a recent Sept. 2025 debut on Home Depot.com (HD), and other e-commerce sites, including on its own site.

As a result, SNES stock looks cheap here with a market cap of $15.0 million (undiluted) at $2.87 per share. This is despite having $10.2 million in cash and no debt. That could be enough to carry SenesTech until it becomes cash flow positive, at least on a run-rate basis, based on my calculations.

I live in Phoenix, AZ, and I recently visited SenesTech’s new plant in a suburb (Surprise, AZ) and met with management. My due diligence leads me to believe SNES stock could be an explosively profitable play over the next year.
 

(Joel Fruendt, CEO, at the new SenesTech headquarters and plant in Surprise, AZ. Source: Author)

This is because, based on potential catalysts across its six different verticals where it sells Evolve, SenesTech could surprise the market much sooner than investors may expect.

Strong Revenue and Potential Catalysts

SenesTech says that the product market for controlling rat and mouse populations in the U.S. is $1 billion, and that it is over $4.5 billion internationally. Most products, except for SenesTech’s Evolve (and ContraPest), are rodenticides that use poison to kill the rodents.

SenesTech’s Evolve is a sustainable alternative, using birth control over a period of months to reduce and suppress fertility rates. After all, two rats (the same as mice) can become 15,000 in one year, according to the company.

Evolve is SenesTech’s latest and most successful food product. The key ingredient is cottonseed oil, which, for various reasons, reduces both sperm and egg production in rats and mice. As a result, over the first quarter to five months, as rats eat the Evolve sausage-like product, birth control kicks in and the rat population falls dramatically.
 

Source: Presentation deck, page 10

Evolve is now seen as highly effective in the market and, most importantly, is exempt from EPA regulation under a sort of safe-harbor exemption. After all, its ingredients are common items that are attractive to rats and mice, with no poison.

The next effect is that revenue is growing quickly. This past quarter, sales rose +43.2% YoY to $690K of which 85% came from Evolve. Over the trailing 12 months (TTM), Q3 revenues have reached $2.3 million, up 23.9% over the $1.857 million in sales during the 2024 calendar year.
 

(Click on image to enlarge)

Source: Hake analysis from company earnings releases and 10-Q filings

Moreover, SenesTech is now generating strong gross margins, as shown in my table above. For example, in 2024, SenesTech generated a gross margin (GM) of just 54.1%. But, in the last three quarters, its GM has been significantly higher, including 62.8% in Q3.

But the real upside with SenesTech is its six verticals (e-commerce and pest-management professionals, or PMPs, are the two largest). For example, e-commerce, excluding its latest Lowe’s announcement, already accounts for 54% of its total sales. Much of this is from its Amazon.com site using FBA (Fulfillment by Amazon). Amazon typically takes 30% of total sales in fees. So, if SenesTech can eventually ship more product out of its own plant directly to customers, it could increase that revenue line.

In addition, on the Q3 conference call and in my discussions with management, SenesTech implied that potential international sales could really boost sales. After all, one container load of SenesTech’s Evolve would be over $200K in sales. Management said on the conference call that SenesTech is waiting for 18 countries to approve sales of Evolve. Some of this could start within the next 3 months, the CEO said. For example, on Nov. 11, SenesTech reported that Belize had just approved imports and distribution of Evolve.

One of the most fundamental growth drivers is that SenesTech’s rat and mouse birth control products tend to induce recurring sales. For example, after an initial order burst, the rat populations decline, but the client still needs to continue ordering a base level of Evolve. That way, the client can maintain the birth control effect among the rat and mouse population. This implies that the more its client roster grows, the greater the level of long-term recurring sales.

Potential Upside and Other Value Drivers

SenesTech has significant upside, despite its negative free cash flow, which is burning through its $10.2 million in cash and securities on its balance sheet.

For example, if the company were able to reach just 1% of the $1 billion rodent control market in the U.S, its potential sales could be $10 million. That is about 3.6x its current run-rate sales of $2.76 million (i.e., $690K in Q3 x 4).

Moreover, if it were to achieve just one large country’s sales of 5 containers a year, i.e., $1 million, that would raise sales by 36% (i.e., $1m / $2.76m).

That could also push it closer to breakeven, especially if online sales start to lead to in-store sales. For example, management told the Q3 conference call that stores like Home Depot, Lowe’s, and Ace Hardware typically want to see traction online for new products before introducing them in stores and their distribution network.

As a result, management has said it expects the company to be cash flow positive by the end of 2026. This implies (at least on a run-rate basis) sales could rise to around $5.5 million by Q4 2026, or about double its current run rate of $2.76 million. More on this below.

In addition, based on my discussions with SenesTech, I suspect that it could introduce additional new products over the coming year. These may not cost the company much in terms of gross margin and related development expense.

Downside Risks and Related Issues

So far this year, SenesTech has burned through $4.086 million in operating cash flow (per its latest 10-Q filing. Moreover, after adding in the negative $1.376 million in Q3 operating cash flow, the ongoing quarterly burn rate is about $5.465 million (i.e., $1.376m Q3 + $4.086 YTD). That is similar to the quarterly burn rate from Q3 (i.e., -$1.376m x 4 = -$5.504 million).

However, management said that it paid a one-time $111K legal expense in Q3. So, its adjusted cash flow burn rate, absent this one-time expense, was $1.265 million in Q3, or $5.06 million on an annualized basis.

Therefore, its $10.2 million in cash and securities could potentially finance 2 years (8 quarters) of negative operating cash flow, if they didn’t improve. But, if sales increase by 100% over the next five quarters to $5.52 million (i.e., $2.76 million run rate x 2), SenesTech could achieve positive cash flow by Q4 2026 without burning through all of its cash.

For example, $10.2 million in cash, if drawn down by $0.75 million to $1.375 million over the next year to the end of 2026, would fall to $4 million or slightly lower. That would leave SenesTech with a positive cash balance once it achieves a cash flow positive quarterly rate.

SenesTech is also still dealing with a lawsuit, which it discussed on the conference call. That could potentially eat up more of its cash. But at least it can now show the opposing party that it has the ability to withstand litigation expenses.

Summary and Conclusion

SenesTech could be too cheap here, especially given its significant cash position, potential catalysts, and value drivers. Moreover, it has sales catalysts and considerable growth drivers.

As a result, SenesTech could become cash-flow positive within the next 5 quarters or so. If that occurs, SenesTech’s stock could double or more anytime over the next year and a half.

The bottom line is that SNES stock could have good upside, despite its present cash flow situation.

Related Articles:
SenesTech Remains Undervalued With Increasing Revenues And Global Product Distribution
SenesTech's Big Play On Small Pests
SenesTech: A Little-Known Biotech Company Worthy Of Attention
SenesTech: The Smart Money’s Bet On Rodent Population Control
SenesTech Has Built A Better Mouse Trap

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