OrganoClick AB (publ) (STO:ORGC) Is Expected To Breakeven In The Near Future

OrganoClick AB (publ) (STO:ORGC) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. OrganoClick AB (publ), a material and chemical technology company, develops, manufactures, and markets fiber-based materials and biobased chemical products for the treatment of wood, technical textile and nonwoven, and bio composites in Sweden. The kr293m market-cap company’s loss lessened since it announced a kr44m loss in the full financial year, compared to the latest trailing-twelve-month loss of kr33m, as it approaches breakeven. As path to profitability is the topic on OrganoClick'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.

View our latest analysis for OrganoClick

OrganoClick is bordering on breakeven, according to some Swedish Chemicals analysts. They expect the company to post a final loss in 2024, before turning a profit of kr9.0m in 2025. 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 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 92% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for OrganoClick given that this is a high-level summary, but, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 36% 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 OrganoClick, so if you are interested in understanding the company at a deeper level, take a look at OrganoClick's company page on Simply Wall St. We've also compiled a list of pertinent aspects you should look at:

1. Valuation: What is OrganoClick 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 OrganoClick 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 OrganoClick’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.