Analysts Are Optimistic We'll See A Profit From TECO 2030 ASA (OB:TECO)

TECO 2030 ASA (OB:TECO) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. TECO 2030 ASA, together with its subsidiaries, operates as an engineering and equipment development company for the maritime industry worldwide. The kr868m market-cap company posted a loss in its most recent financial year of kr27m and a latest trailing-twelve-month loss of kr38m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which TECO 2030 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 TECO 2030

According to some industry analysts covering TECO 2030, breakeven is near. They anticipate the company to incur a final loss in 2020, before generating positive profits of kr35m in 2021. The company is therefore projected to breakeven around a year from now or less! At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 62%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of TECO 2030's upcoming projects, but, take into account that generally 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 aspect worth mentioning. The company has managed its capital judiciously, with debt making up 2.6% 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 TECO 2030, so if you are interested in understanding the company at a deeper level, take a look at TECO 2030's company page on Simply Wall St. We've also compiled a list of essential aspects you should look at:

1. Valuation: What is TECO 2030 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 TECO 2030 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 TECO 2030’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. 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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