Nordex SE (ETR:NDX1) About To Shift From Loss To Profit

We feel now is a pretty good time to analyse Nordex SE's (ETR:NDX1) business as it appears the company may be on the cusp of a considerable accomplishment. Nordex SE, together with its subsidiaries, develops, manufactures, and distributes multi-megawatt onshore wind turbines worldwide. With the latest financial year loss of €303m and a trailing-twelve-month loss of €101m, the €3.4b market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Nordex will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for Nordex

According to the 10 industry analysts covering Nordex, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2023, before generating positive profits of €22m in 2024. So, the company is predicted to breakeven approximately a year from now or less! How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 77% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for Nordex given that this is a high-level summary, however, 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 we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 4.7% of equity. This means that it 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 Nordex, so if you are interested in understanding the company at a deeper level, take a look at Nordex's company page on Simply Wall St. We've also put together a list of relevant factors you should look at:

1. Valuation: What is Nordex 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 Nordex 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 Nordex’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.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.