On Track Innovations Ltd’s (NASDAQ:OTIV): On Track Innovations Ltd. designs, develops, and markets cashless payment solutions worldwide. With the latest financial year loss of -US$1.68m and a trailing-twelve month of -US$1.20m, the US$48.17m market-cap alleviates its loss by moving closer towards its target of breakeven. Many investors are wondering the rate at which OTIV will turn a profit, with the big question being “when will the company breakeven?” I’ve put together a brief outline of industry analyst expectations for OTIV, its year of breakeven and its implied growth rate.See our latest analysis for On Track Innovations
According to the industry analysts covering OTIV, breakeven is near. They expect the company to post a final loss in -1, before turning a profit of US$0 in . OTIV is therefore projected to breakeven around a couple of months from now! How fast will OTIV have to grow each year in order to reach the breakeven point by ? Working backwards from analyst estimates, it turns out that they expect the company to grow 43.65% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, OTIV may become profitable much later than analysts predict.
I’m not going to go through company-specific developments for OTIV given that this is a high-level summary, though, bear in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing I would like to bring into light with OTIV is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in OTIV’s case is 40.38%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.
There are key fundamentals of OTIV 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 OTIV, take a look at OTIV’s company page on Simply Wall St. I’ve also compiled a list of relevant aspects you should further examine:
- Valuation: What is OTIV 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 OTIV is currently mispriced by the market.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on On Track Innovations’s board and the CEO’s back ground.
- 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.