Market Sentiment Around Loss-Making MoSys Inc (NASDAQ:MOSY)

MoSys Inc’s (NASDAQ:MOSY): MoSys, Inc., a fabless semiconductor company, together with its subsidiaries, develops and sells integrated circuits (ICs) for the high-speed networking, communications, storage, and computing markets. On 31 December 2017, the US$11.09M market-cap posted a loss of -US$10.67M for its most recent financial year. The most pressing concern for investors is MOSY’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for MOSY.

Check out our latest analysis for MoSys

According to the industry analysts covering MOSY, breakeven is near. They anticipate the company to incur a final loss in 2018, before generating positive profits of US$353.00K in 2019. Therefore, MOSY is expected to breakeven roughly a few months from now. How fast will MOSY have to grow each year in order to reach the breakeven point by 2019? Working backwards from analyst estimates, it turns out that they expect the company to grow 133.83% 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.

NasdaqCM:MOSY Past Future Earnings Mar 16th 18
NasdaqCM:MOSY Past Future Earnings Mar 16th 18

Underlying developments driving MOSY’s growth isn’t the focus of this broad overview, but, bear in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before I wrap up, there’s one issue worth mentioning. MOSY currently has a debt-to-equity ratio of 124.69%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in MOSY’s case, it has significantly overshot. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on MOSY, so if you are interested in understanding the company at a deeper level, take a look at MOSY’s company page on Simply Wall St. I’ve also compiled a list of key aspects you should look at:

  1. Historical Track Record: What has MOSY’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.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on MoSys’s board and the CEO’s back ground.
  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.