We feel now is a pretty good time to analyse Broadwind, Inc.'s (NASDAQ:BWEN) business as it appears the company may be on the cusp of a considerable accomplishment. Broadwind, Inc. provides products to the energy, mining, and infrastructure sector customers primarily in the United States. The US$70m market-cap company posted a loss in its most recent financial year of US$4.6m and a latest trailing-twelve-month loss of US$1.0m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Broadwind 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.
Broadwind is bordering on breakeven, according to the 3 American Electrical analysts. They expect the company to post a final loss in 2019, before turning a profit of US$2.5m in 2020. The company is therefore projected to breakeven around a year from now or less! How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2020? Working backwards from analyst estimates, it turns out that they expect the company to grow 47% year-on-year, on average, 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 Broadwind given that this is a high-level summary, however, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one issue worth mentioning. Broadwind currently has a relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Broadwind's case is 53%. Note that a higher debt obligation increases the risk in investing in the loss-making company.
There are too many aspects of Broadwind to cover in one brief article, but the key fundamentals for the company can all be found in one place – Broadwind's company page on Simply Wall St. We've also put together a list of important factors you should further examine:
- Valuation: What is Broadwind 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 Broadwind 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 Broadwind’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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