When Will Orbital Energy Group, Inc. (NASDAQ:OEG) Turn A Profit?

We feel now is a pretty good time to analyse Orbital Energy Group, Inc.'s (NASDAQ:OEG) business as it appears the company may be on the cusp of a considerable accomplishment. Orbital Energy Group, Inc. provides electric power, telecommunications, and renewables solutions and services in the United States and India. The US$137m market-cap company announced a latest loss of US$50m on 31 December 2021 for its most recent financial year result. The most pressing concern for investors is Orbital Energy Group'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.

Check out our latest analysis for Orbital Energy Group

Consensus from 2 of the American Construction analysts is that Orbital Energy Group is on the verge of breakeven. They expect the company to post a final loss in 2022, before turning a profit of US$8.3m in 2023. Therefore, the company is expected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 135% year-on-year, on average, 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 Orbital Energy Group's growth isn’t the focus of this broad overview, 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 Orbital Energy Group 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. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are key fundamentals of Orbital Energy Group which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Orbital Energy Group, take a look at Orbital Energy Group's company page on Simply Wall St. We've also put together a list of relevant aspects you should further research:

1. Valuation: What is Orbital Energy Group 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 Orbital Energy Group 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 Orbital Energy Group’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.