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With the business potentially at an important milestone, we thought we'd take a closer look at nLIGHT, Inc.'s (NASDAQ:LASR) future prospects. nLIGHT, Inc. designs, manufactures, and sells semiconductor and fiber lasers for industrial, microfabrication, and aerospace and defense applications. On 31 December 2021, the US$687m market-cap company posted a loss of US$30m for its most recent financial year. The most pressing concern for investors is nLIGHT's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.
Check out our latest analysis for nLIGHT
According to the 8 industry analysts covering nLIGHT, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$32m in 2024. The company is therefore projected to breakeven around 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 39%, which signals high confidence from analysts. 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 nLIGHT given that this is a high-level summary, but, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we’d like to point out is that nLIGHT has no debt on its balance sheet, which is rare for a loss-making growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
Next Steps:
This article is not intended to be a comprehensive analysis on nLIGHT, so if you are interested in understanding the company at a deeper level, take a look at nLIGHT'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 nLIGHT 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 nLIGHT 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 nLIGHT’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.