When Will Nanoveu Limited (ASX:NVU) Breakeven?
With the business potentially at an important milestone, we thought we'd take a closer look at Nanoveu Limited's (ASX:NVU) future prospects. Nanoveu Limited, a technology company, develops and commercializes nanoimprint science applications in the Americas and internationally. On 31 December 2020, the AU$9.0m market-cap company posted a loss of AU$1.8m for its most recent financial year. The most pressing concern for investors is Nanoveu's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.
Check out our latest analysis for Nanoveu
Expectations from some of the Australian Electronic analysts is that Nanoveu is on the verge of breakeven. They anticipate the company to incur a final loss in 2022, before generating positive profits of AU$400k 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 89%, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
We're not going to go through company-specific developments for Nanoveu given that this is a high-level summary, though, bear in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up -1.3% 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.
Next Steps:
This article is not intended to be a comprehensive analysis on Nanoveu, so if you are interested in understanding the company at a deeper level, take a look at Nanoveu's company page on Simply Wall St. We've also compiled a list of pertinent aspects you should further examine:
Valuation: What is Nanoveu 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 Nanoveu 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 Nanoveu’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.
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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