American Superconductor Corporation's (NASDAQ:AMSC) Profit Outlook

With the business potentially at an important milestone, we thought we'd take a closer look at American Superconductor Corporation's (NASDAQ:AMSC) future prospects. American Superconductor Corporation, together with its subsidiaries, provides megawatt-scale power resiliency solutions worldwide. With the latest financial year loss of US$11m and a trailing-twelve-month loss of US$8.2m, the US$724m market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is American Superconductor's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for American Superconductor

Consensus from 3 of the American Electrical analysts is that American Superconductor is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of US$3.9m in 2026. The company is therefore projected to breakeven around 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2026? 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.

Given this is a high-level overview, we won’t go into details of American Superconductor's upcoming projects, however, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 0.006% 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 American Superconductor to cover in one brief article, but the key fundamentals for the company can all be found in one place – American Superconductor's company page on Simply Wall St. We've also put together a list of pertinent aspects you should look at:

1. Valuation: What is American Superconductor 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 American Superconductor 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 American Superconductor’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.