When Will CUI Global, Inc. (NASDAQ:CUI) Turn A Profit?
CUI Global, Inc.’s (NASDAQ:CUI): CUI Global, Inc., through its subsidiaries, engages in the acquisition, development, and commercialization of power and electromechanical components worldwide. With the latest financial year loss of -US$12.6m and a trailing-twelve month of -US$14.8m, the US$36m market-cap amplifies its loss by moving further away from its breakeven target. As path to profitability is the topic on CUI’s investors mind, I’ve decided to gauge market sentiment. In this article, I will touch on the expectations for CUI’s growth and when analysts expect the company to become profitable.
See our latest analysis for CUI Global
Consensus from the 4 Electronic analysts is CUI is on the verge of breakeven. They anticipate the company to incur a final loss in 2018, before generating positive profits of US$3.8m in 2019. Therefore, CUI is expected to breakeven roughly a couple of months from now! In order to meet this breakeven date, I calculated the rate at which CUI must grow year-on-year. It turns out an average annual growth rate of 113% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
I’m not going to go through company-specific developments for CUI given that this is a high-level summary, though, keep 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 I’d like to point out is that CUI has managed its capital judiciously, with debt making up 22% of equity. This means that CUI 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:
This article is not intended to be a comprehensive analysis on CUI, so if you are interested in understanding the company at a deeper level, take a look at CUI’s company page on Simply Wall St. I’ve also compiled a list of pertinent aspects you should further research:
Valuation: What is CUI worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether CUI is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on CUI Global’s board and the CEO’s back ground.
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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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
