Loss-Making Nordic Halibut AS (OB:NOHAL) Expected To Breakeven In The Medium-Term

Nordic Halibut AS (OB:NOHAL) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Nordic Halibut AS produces and sells farmed Atlantic halibut products worldwide. The kr828m market-cap company’s loss lessened since it announced a kr62m loss in the full financial year, compared to the latest trailing-twelve-month loss of kr40m, as it approaches breakeven. As path to profitability is the topic on Nordic Halibut'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 Nordic Halibut

Nordic Halibut is bordering on breakeven, according to the 2 Norwegian Food analysts. They expect the company to post a final loss in 2023, before turning a profit of kr39m in 2024. Therefore, the company is expected to breakeven just over a year from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 57% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Nordic Halibut's growth isn’t the focus of this broad overview, however, 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’d like to point out is that The company has managed its capital prudently, with debt making up 9.1% 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 Nordic Halibut, so if you are interested in understanding the company at a deeper level, take a look at Nordic Halibut's company page on Simply Wall St. We've also compiled a list of key factors you should further research:

1. Valuation: What is Nordic Halibut 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 Nordic Halibut 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 Nordic Halibut’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.