Analysts Are Optimistic We'll See A Profit From FTAI Aviation Ltd. (NASDAQ:FTAI)

We feel now is a pretty good time to analyse FTAI Aviation Ltd.'s (NASDAQ:FTAI) business as it appears the company may be on the cusp of a considerable accomplishment. FTAI Aviation Ltd. owns and acquires infrastructure and related equipment for the transportation of goods and people worldwide. On 31 December 2022, the US$2.5b market-cap company posted a loss of US$138m for its most recent financial year. The most pressing concern for investors is FTAI Aviation's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

See our latest analysis for FTAI Aviation

Consensus from 6 of the American Trade Distributors analysts is that FTAI Aviation is on the verge of breakeven. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$177m in 2023. The company is therefore projected to breakeven around a year from now or less! At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 80%, which is extremely buoyant. 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 FTAI Aviation's upcoming projects, but, take into account that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with FTAI Aviation is its debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of FTAI Aviation to cover in one brief article, but the key fundamentals for the company can all be found in one place – FTAI Aviation's company page on Simply Wall St. We've also compiled a list of important aspects you should further examine:

1. Valuation: What is FTAI Aviation 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 FTAI Aviation 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 FTAI Aviation’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.