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Air Industries Group's (NYSEMKT:AIRI) Shift From Loss To Profit

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Simply Wall St
·3 min read
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We feel now is a pretty good time to analyse Air Industries Group's (NYSEMKT:AIRI) business as it appears the company may be on the cusp of a considerable accomplishment. Air Industries Group, an aerospace and defense company, designs, manufactures, and sells structural parts and assemblies that focus on flight safety. The US$39m market-cap company posted a loss in its most recent financial year of US$2.6m and a latest trailing-twelve-month loss of US$1.4m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Air Industries Group will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for Air Industries Group

Air Industries Group is bordering on breakeven, according to some American Aerospace & Defense analysts. They expect the company to post a final loss in 2020, before turning a profit of US$2.9m in 2021. The company is therefore projected to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 172% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
earnings-per-share-growth

Given this is a high-level overview, we won’t go into details of Air Industries Group's upcoming projects, but, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with Air Industries Group is its debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of Air Industries Group to cover in one brief article, but the key fundamentals for the company can all be found in one place – Air Industries Group's company page on Simply Wall St. We've also compiled a list of important aspects you should further examine:

  1. Historical Track Record: What has Air Industries Group's 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.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Air Industries Group's board and the CEO’s background.

  3. 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.

This article by Simply Wall St is general in nature. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.