When Can We Expect A Profit From Smoltek Nanotech Holding AB (NGM:SMOL)?

Smoltek Nanotech Holding AB (NGM:SMOL) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Smoltek Nanotech Holding AB operates as a nanotechnology company in Sweden. With the latest financial year loss of kr36m and a trailing-twelve-month loss of kr36m, the kr243m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Smoltek Nanotech Holding will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

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According to some industry analysts covering Smoltek Nanotech Holding, breakeven is near. They expect the company to post a final loss in 2027, before turning a profit of kr14m in 2028. Therefore, the company is expected to breakeven roughly 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2028? Working backwards from analyst estimates, it turns out that they expect the company to grow 85% 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.

Underlying developments driving Smoltek Nanotech Holding's growth isn’t the focus of this broad overview, however, 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.

View our latest analysis for Smoltek Nanotech Holding

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 13% of equity. This means that it 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:

This article is not intended to be a comprehensive analysis on Smoltek Nanotech Holding, so if you are interested in understanding the company at a deeper level, take a look at Smoltek Nanotech Holding's company page on Simply Wall St. We've also put together a list of pertinent factors you should further research:

1. Valuation: What is Smoltek Nanotech Holding 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 Smoltek Nanotech Holding 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 Smoltek Nanotech Holding’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.