CUI Global Inc (NASDAQ:CUI): When Will It Breakeven?

CUI Global Inc's (NASDAQ:CUI): CUI Global, Inc., through its subsidiaries, engages in the acquisition, development, and commercialization of power and electromechanical components worldwide. The US$79.81M market-cap company’s loss lessens since it announced a -US$12.59M bottom-line in the full financial year, compared to the latest trailing-twelve-month loss of -US$12.00M, as it approaches breakeven. The most pressing concern for investors is CUI’s path to profitability – when will it breakeven? In this article, I will touch on the expectations for CUI’s growth and when analysts expect the company to become profitable.

CUI is bordering on breakeven, according to analysts. They expect the company to post a final loss in 2018, before turning a profit of US$6.27M in 2019. CUI is therefore projected to breakeven around a couple of months from now! How fast will CUI 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 101.65% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, CUI may become profitable much later than analysts predict.

Given this is a high-level overview, I won’t go into detail the detail of CUI’s upcoming projects, but, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing I’d like to point out is that CUI has managed its capital prudently, with debt making up 17.15% of equity. This means that CUI 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 key fundamentals of CUI which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at CUI, take a look at CUI’s company page on Simply Wall St. I’ve also put together a list of pertinent aspects you should further research:

1. Valuation: What is CUI 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 CUI 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 CUI Global’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.

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.