Loss-Making Nexam Chemical Holding AB (publ) (STO:NEXAM) Expected To Breakeven In The Medium-Term

Nexam Chemical Holding AB (publ) (STO:NEXAM) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Nexam Chemical Holding AB (publ) develops solutions that enhance properties and performance of various polymers in Sweden, Europe, and internationally. With the latest financial year loss of kr23m and a trailing-twelve-month loss of kr10.0m, the kr324m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Nexam Chemical Holding will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Nexam Chemical Holding

According to some industry analysts covering Nexam Chemical Holding, breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of kr8.0m in 2025. So, the company is predicted to breakeven just over a year from now. 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 118% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Nexam Chemical Holding's growth isn’t the focus of this broad overview, but, keep in mind that generally 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 12% 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:

There are too many aspects of Nexam Chemical Holding to cover in one brief article, but the key fundamentals for the company can all be found in one place – Nexam Chemical Holding's company page on Simply Wall St. We've also put together a list of relevant factors you should further examine:

1. Valuation: What is Nexam Chemical Holding 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 Nexam Chemical Holding 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 Nexam Chemical Holding’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.