When Will FTC Solar, Inc. (NASDAQ:FTCI) Turn A Profit?

By
Simply Wall St
Published
April 19, 2022
NasdaqGM:FTCI
Source: Shutterstock

FTC Solar, Inc. (NASDAQ:FTCI) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. FTC Solar, Inc. provides solar tracker systems, technology, software, and engineering services in the United States, Vietnam, and internationally. The US$342m market-cap company announced a latest loss of US$107m on 31 December 2021 for its most recent financial year result. The most pressing concern for investors is FTC Solar's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for FTC Solar

FTC Solar is bordering on breakeven, according to the 7 American Electrical analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$49m in 2023. Therefore, the company is expected 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 80% is expected, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth
NasdaqGM:FTCI Earnings Per Share Growth April 19th 2022

Underlying developments driving FTC Solar's growth isn’t the focus of this broad overview, though, 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.

Before we wrap up, there’s one aspect worth mentioning. FTC Solar currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

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

  1. Valuation: What is FTC Solar 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 FTC Solar 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 FTC Solar’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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