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We feel now is a pretty good time to analyse Kromek Group plc's (LON:KMK) business as it appears the company may be on the cusp of a considerable accomplishment. Kromek Group plc, together with its subsidiaries, develops, manufactures, and sells radiation detection components and devices for the advanced imaging, CBRN detection, and biological threat detection markets. The UK£33m market-cap company posted a loss in its most recent financial year of UK£3.3m and a latest trailing-twelve-month loss of UK£5.9m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which Kromek Group will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.
Expectations from some of the British Semiconductor analysts is that Kromek Group is on the verge of breakeven. They anticipate the company to incur a final loss in 2024, before generating positive profits of UK£1.9m in 2025. Therefore, the company is expected to breakeven roughly 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 75% is expected, 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 Kromek Group given that this is a high-level summary, however, take into account 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 Kromek Group
One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 29% 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:
There are key fundamentals of Kromek Group 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 Kromek Group, take a look at Kromek Group's company page on Simply Wall St. We've also compiled a list of relevant factors you should look at:
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Valuation: What is Kromek Group 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 Kromek Group 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 Kromek Group’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.
