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good natured Products Inc. (CVE:GDNP): Are Analysts Optimistic?

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Simply Wall St
·3 min read
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good natured Products Inc. (CVE:GDNP) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. good natured Products Inc., through its subsidiaries, designs, produces, and distributes bioplastics for use in packaging and durable product applications in Canada and the United States. With the latest financial year loss of CA$3.5m and a trailing-twelve-month loss of CA$4.9m, the CA$132m market-cap company amplified its loss by moving further away from its breakeven target. The most pressing concern for investors is good natured Products' 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.

View our latest analysis for good natured Products

According to the 4 industry analysts covering good natured Products, the consensus is that breakeven is near. They expect the company to post a final loss in 2021, before turning a profit of CA$863k in 2022. The company is therefore projected to breakeven just over a year 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 102%, 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
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Underlying developments driving good natured Products' growth isn’t the focus of this broad overview, but, take into account that generally 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 good natured Products is it currently has negative equity on its balance sheet. This can sometimes arise from accounting methods used to deal with accumulated losses from prior years, which are viewed as liabilities carried forward until it cancels out in the future. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

This article is not intended to be a comprehensive analysis on good natured Products, so if you are interested in understanding the company at a deeper level, take a look at good natured Products' company page on Simply Wall St. We've also compiled a list of relevant factors you should further examine:

  1. Historical Track Record: What has good natured Products' 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 good natured Products' 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.

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