Everfuel A/S (OB:EFUEL): When Will It Breakeven?

By
Simply Wall St
Published
February 25, 2022
OB:EFUEL
Source: Shutterstock

With the business potentially at an important milestone, we thought we'd take a closer look at Everfuel A/S' (OB:EFUEL) future prospects. Everfuel A/S operates as an integrated green hydrogen fuel company in Denmark, Norway, Sweden, the Netherlands, Germany, and Belgium. The kr3.1b market-cap company announced a latest loss of €6.5m on 31 December 2021 for its most recent financial year result. As path to profitability is the topic on Everfuel's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Everfuel

Expectations from some of the Norwegian Oil and Gas analysts is that Everfuel is on the verge of breakeven. They expect the company to post a final loss in 2023, before turning a profit of €65k in 2024. The company is therefore projected to breakeven around 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 73% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
OB:EFUEL Earnings Per Share Growth February 25th 2022

We're not going to go through company-specific developments for Everfuel given that this is a high-level summary, however, keep in mind that generally energy companies, depending on the stage of operation and resource produced, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

Before we wrap up, there’s one aspect worth mentioning. Everfuel currently has no debt on its balance sheet, which is rare for a loss-making oil and gas company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Everfuel 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 Everfuel, take a look at Everfuel's company page on Simply Wall St. We've also compiled a list of important aspects you should further research:

  1. Historical Track Record: What has Everfuel's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Everfuel'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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