Aqua Metals, Inc.’s (NASDAQ:AQMS): Aqua Metals, Inc. engages in the recycling of lead primarily in the United States. The US$44m market-cap posted a loss in its most recent financial year of -US$40.3m and a latest trailing-twelve-month loss of -US$47.1m leading to an even wider gap between loss and breakeven. As path to profitability is the topic on AQMS’s investors mind, I’ve decided to gauge market sentiment. In this article, I will touch on the expectations for AQMS’s growth and when analysts expect the company to become profitable.
Check out our latest analysis for Aqua Metals
Expectation from Commercial Services analysts is AQMS is on the verge of breakeven. They expect the company to post a final loss in 2020, before turning a profit of US$11m in 2021. So, AQMS is predicted to breakeven approximately a few months from now. What rate will AQMS have to grow year-on-year in order to breakeven on this date? Using a line of best fit, I calculated an average annual growth rate of 86%, 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 AQMS’s growth isn’t the focus of this broad overview, though, take into account 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. AQMS has managed its capital prudently, with debt making up 15% of equity. This means that AQMS 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:
There are too many aspects of AQMS to cover in one brief article, but the key fundamentals for the company can all be found in one place – AQMS’s company page on Simply Wall St. I’ve also put together a list of key aspects you should look at:
- Historical Track Record: What has AQMS’s 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 Aqua Metals’s board and the CEO’s back ground.
- 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 [email protected]. 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.
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