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Quest Resource Holding Corporation (NASDAQ:QRHC): Are Analysts Optimistic?

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Quest Resource Holding Corporation's (NASDAQ:QRHC): Quest Resource Holding Corporation, through its subsidiaries, provides solutions for the reuse, recycling, and disposal of various waste streams and recyclables in the United States. The company’s loss has recently broadened since it announced a -US$55.2k loss in the full financial year, compared to the latest trailing-twelve-month loss of -US$123.2k, moving it further away from breakeven. The most pressing concern for investors is QRHC’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for QRHC.

View our latest analysis for Quest Resource Holding

QRHC is bordering on breakeven, according to the 2 Commercial Services analysts. They anticipate the company to incur a final loss in 2020, before generating positive profits of US$664k in 2021. So, QRHC is predicted to breakeven approximately a couple of months from now! How fast will QRHC have to grow each year in order to reach the breakeven point by 2021? Working backwards from analyst estimates, it turns out that they expect the company to grow 65% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

NasdaqCM:QRHC Past and Future Earnings May 17th 2020
NasdaqCM:QRHC Past and Future Earnings May 17th 2020

Given this is a high-level overview, I won’t go into details of QRHC’s upcoming projects, but, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before I wrap up, there’s one aspect worth mentioning. QRHC has managed its capital judiciously, with debt making up 4.5% of equity. This means that QRHC 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 QRHC, so if you are interested in understanding the company at a deeper level, take a look at QRHC’s company page on Simply Wall St. I’ve also put together a list of essential factors you should further research:

  1. Valuation: What is QRHC 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 QRHC is currently mispriced by the market.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Quest Resource Holding’s board and the CEO’s back ground.

  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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.