Loss-Making Helix Energy Solutions Group, Inc. (NYSE:HLX) Set To Breakeven

Helix Energy Solutions Group, Inc. (NYSE:HLX) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Helix Energy Solutions Group, Inc., together with its subsidiaries, an offshore energy services company, provides specialty services to the offshore energy industry in Brazil, the Gulf of Mexico, the East Coast of the United States, North Sea, the Asia Pacific, and West Africa regions. With the latest financial year loss of US$11m and a trailing-twelve-month loss of US$32m, the US$1.6b market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Helix Energy Solutions Group will turn a profit, with the big question being “when will the company 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 Helix Energy Solutions Group

Consensus from 4 of the American Energy Services analysts is that Helix Energy Solutions Group is on the verge of breakeven. They expect the company to post a final loss in 2023, before turning a profit of US$52m in 2024. 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 41%, 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 Helix Energy Solutions Group's upcoming projects, however, keep in mind that typically an energy business has lumpy cash flows which are contingent on the natural resource and stage at which the company is operating. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 22% 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:

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

1. Valuation: What is Helix Energy Solutions 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 Helix Energy Solutions 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 Helix Energy Solutions 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com