Breakeven Is Near for Greenidge Generation Holdings Inc. (NASDAQ:GREE)
We feel now is a pretty good time to analyse Greenidge Generation Holdings Inc.'s (NASDAQ:GREE) business as it appears the company may be on the cusp of a considerable accomplishment. Greenidge Generation Holdings Inc. operates as an integrated cryptocurrency datacenter and power generation company. The company’s loss has recently broadened since it announced a US$45m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$46m, moving it further away from breakeven. As path to profitability is the topic on Greenidge Generation Holdings' investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
See our latest analysis for Greenidge Generation Holdings
According to the 2 industry analysts covering Greenidge Generation Holdings, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$20m in 2022. Therefore, the company is expected to breakeven roughly a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 58% is expected, 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.
We're not going to go through company-specific developments for Greenidge Generation Holdings given that this is a high-level summary, however, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we would like to bring into light with Greenidge Generation Holdings is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Greenidge Generation Holdings' case is 79%. Note that a higher debt obligation increases the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on Greenidge Generation Holdings, so if you are interested in understanding the company at a deeper level, take a look at Greenidge Generation Holdings' company page on Simply Wall St. We've also put together a list of relevant factors you should further examine:
Historical Track Record: What has Greenidge Generation Holdings' 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 Greenidge Generation Holdings' 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.
