Pyxis Tankers Inc.’s (NASDAQ:PXS): Pyxis Tankers Inc. operates as a maritime transportation company with a focus on the tanker sector in the United States. On 31 December 2019, the US$16m market-cap posted a loss of -US$8.3m for its most recent financial year. Many investors are wondering the rate at which PXS will turn a profit, with the big question being “when will the company breakeven?” Below I will provide a high-level summary of the industry analysts’ expectations for PXS.
PXS is bordering on breakeven, according to Shipping analysts. They expect the company to post a final loss in 2020, before turning a profit of US$1.9m in 2021. PXS is therefore projected to breakeven around a few months from now. In order to meet this breakeven date, I calculated the rate at which PXS must grow year-on-year. It turns out an average annual growth rate of 118% is expected, 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 PXS’s growth isn’t the focus of this broad overview, however, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing I would like to bring into light with PXS is its debt-to-equity ratio of 198%. Typically, debt shouldn’t exceed 40% of your equity, which in PXS’s case, it has significantly overshot. Note that a higher debt obligation increases the risk around investing in the loss-making company.
There are too many aspects of PXS to cover in one brief article, but the key fundamentals for the company can all be found in one place – PXS’s company page on Simply Wall St. I’ve also compiled a list of relevant factors you should further research:
- Valuation: What is PXS 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 PXS 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 Pyxis Tankers’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.
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