Breakeven On The Horizon For Aqua Metals, Inc. (NASDAQ:AQMS)

Aqua Metals, Inc. (NASDAQ:AQMS) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Aqua Metals, Inc. engages in reinventing metals recycling with its patented AquaRefining technology. With the latest financial year loss of US$15m and a trailing-twelve-month loss of US$18m, the US$50m market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on Aqua Metals' investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for Aqua Metals

According to the 2 industry analysts covering Aqua Metals, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$6.9m in 2026. Therefore, the company is expected to breakeven roughly 2 years from today. 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 58% 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.

Underlying developments driving Aqua Metals' growth isn’t the focus of this broad overview, though, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 8.3% 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:

This article is not intended to be a comprehensive analysis on Aqua Metals, so if you are interested in understanding the company at a deeper level, take a look at Aqua Metals' company page on Simply Wall St. We've also compiled a list of key factors you should further research:

1. Valuation: What is Aqua Metals 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 Aqua Metals 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 Aqua Metals’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.