Breakeven Is Near for Ranpak Holdings Corp. (NYSE:PACK)

We feel now is a pretty good time to analyse Ranpak Holdings Corp.'s (NYSE:PACK) business as it appears the company may be on the cusp of a considerable accomplishment. Ranpak Holdings Corp., together with its subsidiaries, provide product protection solutions for e-commerce and industrial supply chains in North America, Europe, and Asia. The US$1.8b market-cap company announced a latest loss of US$2.8m on 31 December 2021 for its most recent financial year result. The most pressing concern for investors is Ranpak Holdings' path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Ranpak Holdings

Ranpak Holdings is bordering on breakeven, according to the 5 American Packaging analysts. They expect the company to post a final loss in 2021, before turning a profit of US$8.5m in 2022. So, the company is predicted to breakeven approximately a year from now or less! How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 55% year-on-year, on average, which signals high confidence from analysts. 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 Ranpak Holdings' upcoming projects, though, bear in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one issue worth mentioning. Ranpak Holdings currently has a relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Ranpak Holdings' case is 64%. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

There are key fundamentals of Ranpak Holdings 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 Ranpak Holdings, take a look at Ranpak Holdings' company page on Simply Wall St. We've also put together a list of pertinent aspects you should look at:

1. Valuation: What is Ranpak Holdings 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 Ranpak Holdings 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 Ranpak Holdings’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.