Energous Corporation's (NASDAQ:WATT) Profit Outlook
Energous Corporation (NASDAQ:WATT) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Energous Corporation develops wire-free charging solutions. The company’s loss has recently broadened since it announced a US$32m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$39m, moving it further away from breakeven. As path to profitability is the topic on Energous' investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
Check out our latest analysis for Energous
Energous is bordering on breakeven, according to the 2 American Electrical analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$8.6m in 2023. So, the company is predicted to breakeven approximately 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 88%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving Energous' growth isn’t the focus of this broad overview, 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 we wrap up, there’s one aspect worth mentioning. Energous currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
Next Steps:
This article is not intended to be a comprehensive analysis on Energous, so if you are interested in understanding the company at a deeper level, take a look at Energous' company page on Simply Wall St. We've also compiled a list of relevant aspects you should look at:
Historical Track Record: What has Energous' 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 Energous' 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.
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.
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