TREVI - Finanziaria Industriale S.p.A.'s (BIT:TFI): TREVI - Finanziaria Industriale S.p.A., together with its subsidiaries, provides foundation engineering services worldwide. The €47m market-cap posted a loss in its most recent financial year of -€23.9m and a latest trailing-twelve-month loss of -€23.9m shrinking the gap between loss and breakeven. Many investors are wondering the rate at which TFI will turn a profit, with the big question being “when will the company breakeven?” Below I will provide a high-level summary of the industry analysts’ expectations for TFI.
Check out our latest analysis for TREVI - Finanziaria Industriale
Consensus from the 2 Construction analysts is TFI is on the verge of breakeven. They anticipate the company to incur a final loss in 2019, before generating positive profits of €14m in 2020. TFI is therefore projected to breakeven around a couple of months from now! In order to meet this breakeven date, I calculated the rate at which TFI must grow year-on-year. It turns out an average annual growth rate of 147% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, TFI may become profitable much later than analysts predict.
I’m not going to go through company-specific developments for TFI given that this is a high-level summary, however, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before I wrap up, there’s one issue worth mentioning. TFI currently has negative equity on its balance sheet. This can sometimes arise from accounting methods used to deal with accumulated losses from prior years, which are viewed as liabilities carried forward until it cancels out in the future. Oftentimes, losses exist only on paper but other times, it can be a red flag.
Next Steps:
This article is not intended to be a comprehensive analysis on TFI, so if you are interested in understanding the company at a deeper level, take a look at TFI’s company page on Simply Wall St. I’ve also compiled a list of essential aspects you should further examine:
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Historical Track Record: What has TFI's 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.
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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 TREVI - Finanziaria Industriale’s board and the CEO’s back ground.
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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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