When Will Minesto AB (publ) (STO:MINEST) Breakeven?

Simply Wall St · 07/29/2023 07:21

We feel now is a pretty good time to analyse Minesto AB (publ)'s (STO:MINEST) business as it appears the company may be on the cusp of a considerable accomplishment. Minesto AB (publ), together with its subsidiaries, operates as a marine energy developer in Sweden, Wales, the Faroe Islands, Northern Ireland, and Taiwan. The company’s loss has recently broadened since it announced a kr84m loss in the full financial year, compared to the latest trailing-twelve-month loss of kr86m, moving it further away from breakeven. Many investors are wondering about the rate at which Minesto will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

View our latest analysis for Minesto

Minesto is bordering on breakeven, according to some Swedish Electrical analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of kr55m 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 extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
OM:MINEST Earnings Per Share Growth July 29th 2023

We're not going to go through company-specific developments for Minesto given that this is a high-level summary, however, 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 we wrap up, there’s one aspect worth mentioning. Minesto currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Minesto to cover in one brief article, but the key fundamentals for the company can all be found in one place – Minesto's company page on Simply Wall St. We've also put together a list of pertinent aspects you should look at:

  1. Historical Track Record: What has Minesto'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.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Minesto's 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.
Recently
Symbol
Price
%Change