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GFL Environmental Inc. (TSE:GFL) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. GFL Environmental Inc. provides non-hazardous solid waste management and environmental services in Canada and the United States. On 31 December 2024, the CA$27b market-cap company posted a loss of CA$803m for its most recent financial year. Many investors are wondering about the rate at which GFL Environmental 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.
Consensus from 12 of the Canadian Commercial Services analysts is that GFL Environmental is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of CA$125m in 2026. So, the company is predicted to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 148% is expected, 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.
Given this is a high-level overview, we won’t go into details of GFL Environmental's upcoming projects, 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.
View our latest analysis for GFL Environmental
Before we wrap up, there’s one issue worth mentioning. GFL Environmental currently has a debt-to-equity ratio of 139%. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. Note that a higher debt obligation increases the risk in investing in the loss-making company.
Next Steps:
There are key fundamentals of GFL Environmental which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at GFL Environmental, take a look at GFL Environmental's company page on Simply Wall St. We've also put together a list of pertinent aspects you should further examine:
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Valuation: What is GFL Environmental 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 GFL Environmental is currently mispriced by the market.
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Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on GFL Environmental’s board and the CEO’s background.
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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.