Taihan Fiber Optics Co., Ltd (KOSDAQ:010170) Could Be Less Than A Year Away From Profitability

With the business potentially at an important milestone, we thought we'd take a closer look at Taihan Fiber Optics Co., Ltd's (KOSDAQ:010170) future prospects. Taihan Fiber Optics Co., Ltd researches, develops, and produces optical materials in South Korea and internationally. The ₩370b market-cap company’s loss lessened since it announced a ₩56b loss in the full financial year, compared to the latest trailing-twelve-month loss of ₩47b, as it approaches breakeven. Many investors are wondering about the rate at which Taihan Fiber Optics will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

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Taihan Fiber Optics is bordering on breakeven, according to some South Korean Communications analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of ₩14b in 2026. So, the company is predicted to breakeven approximately a year from now or less! At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 179%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Taihan Fiber Optics given that this is a high-level summary, but, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

See our latest analysis for Taihan Fiber Optics

One thing we would like to bring into light with Taihan Fiber Optics is its debt-to-equity ratio of 154%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of Taihan Fiber Optics to cover in one brief article, but the key fundamentals for the company can all be found in one place – Taihan Fiber Optics' company page on Simply Wall St. We've also compiled a list of relevant factors you should look at:

1. Historical Track Record: What has Taihan Fiber Optics' 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 Taihan Fiber Optics' 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.

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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.