When Will Aemetis, Inc. (NASDAQ:AMTX) Breakeven?
With the business potentially at an important milestone, we thought we'd take a closer look at Aemetis, Inc.'s (NASDAQ:AMTX) future prospects. Aemetis, Inc. operates as a renewable natural gas and renewable fuels company. On 31 December 2023, the US$127m market-cap company posted a loss of US$46m for its most recent financial year. Many investors are wondering about the rate at which Aemetis will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.
See our latest analysis for Aemetis
Aemetis is bordering on breakeven, according to the 5 American Oil and Gas analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$37m in 2026. Therefore, the company is expected to breakeven roughly 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 54%, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Given this is a high-level overview, we won’t go into details of Aemetis' upcoming projects, but, take into account that typically energy companies, depending on the stage of operation and resource produced, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
Before we wrap up, there’s one issue worth mentioning. Aemetis currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. Oftentimes, losses exist only on paper but other times, it can be a red flag.
Next Steps:
There are key fundamentals of Aemetis which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Aemetis, take a look at Aemetis' company page on Simply Wall St. We've also compiled a list of essential aspects you should further research:
Historical Track Record: What has Aemetis' performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Aemetis' board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
