We feel now is a pretty good time to analyse ADS-TEC Energy PLC’s (NASDAQ:ADSE) business as it appears the company may be on the cusp of a considerable accomplishment. ADS-TEC Energy PLC provide intelligent and decentralized energy storage systems in Europe and North America. The US$328m market-cap company announced a latest loss of €19m on 31 December 2022 for its most recent financial year result. The most pressing concern for investors is ADS-TEC Energy’s path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company’s growth and when analysts expect it to become profitable.
See our latest analysis for ADS-TEC Energy
According to the 4 industry analysts covering ADS-TEC Energy, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of €7.5m in 2025. The company is therefore projected to breakeven around 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 49% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving ADS-TEC Energy’s growth isn’t the focus of this broad overview, however, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
Before we wrap up, there’s one aspect worth mentioning. ADS-TEC Energy currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.
There are too many aspects of ADS-TEC Energy to cover in one brief article, but the key fundamentals for the company can all be found in one place – ADS-TEC Energy’s company page on Simply Wall St. We’ve also put together a list of important aspects you should further research:
Valuation: What is ADS-TEC Energy 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 ADS-TEC Energy 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 ADS-TEC Energy’s board and the CEO’s background.
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.