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We feel now is a pretty good time to analyse Expro Group Holdings N.V.'s (NYSE:XPRO) business as it appears the company may be on the cusp of a considerable accomplishment. Expro Group Holdings N.V. engages in the provision of energy services in North and Latin America, Europe and Sub-Saharan Africa, the Middle East and North Africa, and the Asia-Pacific. The US$2.2b market-cap company’s loss lessened since it announced a US$23m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$14m, as it approaches breakeven. As path to profitability is the topic on Expro Group Holdings' investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
See our latest analysis for Expro Group Holdings
According to the 5 industry analysts covering Expro Group Holdings, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$78m in 2024. The company is therefore projected to breakeven around 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 42% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Underlying developments driving Expro Group Holdings' growth isn’t the focus of this broad overview, however, take into account that typically an energy business has lumpy cash flows which are contingent on the natural resource and stage at which the company is operating. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 8.3% 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 too many aspects of Expro Group Holdings to cover in one brief article, but the key fundamentals for the company can all be found in one place – Expro Group Holdings' company page on Simply Wall St. We've also put together a list of important aspects you should further examine:
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Valuation: What is Expro Group Holdings 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 Expro Group Holdings 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 Expro Group Holdings’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.