The ExOne Company’s (NASDAQ:XONE): The ExOne Company develops, manufactures, and markets three-dimensional (3D) printing machines, 3D printed and other products, materials, and services primarily in North America, Europe, and Asia. On 31 December 2018, the US$145m market-cap posted a loss of -US$12.7m for its most recent financial year. The most pressing concern for investors is XONE’s path to profitability – when will it breakeven? In this article, I will touch on the expectations for XONE’s growth and when analysts expect the company to become profitable.
XONE is bordering on breakeven, according to the 2 Machinery analysts. They expect the company to post a final loss in 2019, before turning a profit of US$6.6m in 2020. Therefore, XONE is expected to breakeven roughly a few months from now. In order to meet this breakeven date, I calculated the rate at which XONE must grow year-on-year. It turns out an average annual growth rate of 125% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.
I’m not going to go through company-specific developments for XONE given that this is a high-level summary, however, keep in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before I wrap up, there’s one aspect worth mentioning. XONE has managed its capital prudently, with debt making up 2.4% of equity. This means that XONE has predominantly funded its operations from equity capital,and its low debt obligation reduces the risk around investing in the loss-making company.
This article is not intended to be a comprehensive analysis on XONE, so if you are interested in understanding the company at a deeper level, take a look at XONE’s company page on Simply Wall St. I’ve also put together a list of essential factors you should further examine:
- Historical Track Record: What has XONE’s performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on ExOne’s board and the CEO’s back ground.
- 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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