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Ayro, Inc.'s (NASDAQ:AYRO) Shift From Loss To Profit

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Simply Wall St
·3 min read
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Ayro, Inc. (NASDAQ:AYRO) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Ayro, Inc. designs and manufactures light-duty, emissions-free electric vehicles for urban and community transport, local delivery, closed campus mobility, recreational, and government use. With the latest financial year loss of US$8.7m and a trailing-twelve-month loss of US$9.9m, the US$302m market-cap company amplified its loss by moving further away from its breakeven target. The most pressing concern for investors is Ayro's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Ayro

According to some industry analysts covering Ayro, breakeven is near. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$7.6m in 2022. 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 91% is expected, which signals high confidence from analysts. 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

Underlying developments driving Ayro's growth isn’t the focus of this broad overview, however, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 0.8% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Ayro 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 Ayro, take a look at Ayro's company page on Simply Wall St. We've also put together a list of important aspects you should further research:

  1. Historical Track Record: What has Ayro'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 Ayro'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 (at) simplywallst.com.