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. The company’s loss has recently broadened since it announced a -US$12.6m loss in the full financial year, compared to the latest trailing-twelve-month loss of -US$15.2m, moving it further away from breakeven. Many investors are wondering the rate at which CUI will turn a profit, with the big question being “when will the company breakeven?” In this article, I will touch on the expectations for CUI’s growth and when analysts expect the company to become profitable.
Expectation from 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$4.6m in 2019. CUI is therefore projected to breakeven around a few 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 109% 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, 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.
Before I wrap up, there’s one aspect worth mentioning. CUI has managed its capital prudently, with debt making up 18.7% 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.
There are too many aspects of CUI to cover in one brief article, but the key fundamentals for the company can all be found in one place – CUI’s company page on Simply Wall St. I’ve also compiled a list of key factors you should further examine:
- 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.