We feel now is a pretty good time to analyse AutoStore Holdings Ltd.'s (OB:AUTO) business as it appears the company may be on the cusp of a considerable accomplishment. AutoStore Holdings Ltd., a robotic and software technology company, provides warehouse automation solutions in Norway and internationally. With the latest financial year loss of US$23m and a trailing-twelve-month loss of US$18m, the kr86b market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is AutoStore Holdings' path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
AutoStore Holdings is bordering on breakeven, according to the 7 Norwegian Machinery analysts. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$137m in 2022. Therefore, the company is expected to breakeven roughly 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 60% 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 AutoStore Holdings given that this is a high-level summary, but, 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.
One thing we would like to bring into light with AutoStore Holdings is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in AutoStore Holdings' case is 63%. Note that a higher debt obligation increases the risk around investing in the loss-making company.
There are key fundamentals of AutoStore Holdings which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at AutoStore Holdings, take a look at AutoStore Holdings' company page on Simply Wall St. We've also put together a list of essential aspects you should look at:
- Valuation: What is AutoStore Holdings 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 AutoStore Holdings 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 AutoStore Holdings’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. 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.