LiqTech International, Inc.'s (NASDAQ:LIQT) Profit Outlook
With the business potentially at an important milestone, we thought we'd take a closer look at LiqTech International, Inc.'s (NASDAQ:LIQT) future prospects. LiqTech International, Inc., a clean technology company, designs, develops, produces, markets, and sells automated filtering systems, ceramic silicon carbide liquid applications, and diesel particulate air filters in the United States, Canada, Europe, Asia, and South America. On 31 December 2022, the US$21m market-cap company posted a loss of US$14m for its most recent financial year. Many investors are wondering about the rate at which LiqTech International will turn a profit, with the big question being “when will the company breakeven?” 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 LiqTech International
LiqTech International is bordering on breakeven, according to some American Machinery analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$3.1m in 2025. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 101% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
We're not going to go through company-specific developments for LiqTech International given that this is a high-level summary, but, bear in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 24% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
This article is not intended to be a comprehensive analysis on LiqTech International, so if you are interested in understanding the company at a deeper level, take a look at LiqTech International's company page on Simply Wall St. We've also put together a list of important factors you should look at:
Valuation: What is LiqTech International 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 LiqTech International 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 LiqTech International’s 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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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