Nordex SE (ETR:NDX1) On The Verge Of Breaking Even

With the business potentially at an important milestone, we thought we'd take a closer look at Nordex SE's (ETR:NDX1) future prospects. Nordex SE, together with its subsidiaries, develops, manufactures, and distributes multi-megawatt onshore wind turbines worldwide. With the latest financial year loss of €498m and a trailing-twelve-month loss of €460m, the €2.5b market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Nordex's investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Nordex

Nordex is bordering on breakeven, according to the 11 German Electrical analysts. They anticipate the company to incur a final loss in 2023, before generating positive profits of €17m in 2024. Therefore, the company is expected to breakeven roughly a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 91% is expected, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Nordex's growth isn’t the focus of this broad overview, however, bear in mind that by and large 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 32% 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 pertinent aspects you should further examine:

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.