Yahoo Finance Hastings Technology Metals Limited's (ASX:HAS) Profit Outlook
With the business potentially at an important milestone, we thought we'd take a closer look at Hastings Technology Metals Limited's (ASX:HAS) future prospects. Hastings Technology Metals Limited engages in the exploration and development of rare earth deposits in Australia. The AU$47m market-cap company posted a loss in its most recent financial year of AU$11m and a latest trailing-twelve-month loss of AU$15m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which Hastings Technology Metals will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
View our latest analysis for Hastings Technology Metals
According to the 2 industry analysts covering Hastings Technology Metals, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of AU$26m in 2026. Therefore, the company is expected to breakeven roughly 2 years from today. 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 17%, which seems realistic. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Given this is a high-level overview, we won’t go into details of Hastings Technology Metals' upcoming projects, though, take into account that generally a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. So, a double-digit growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing we would like to bring into light with Hastings Technology Metals is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Hastings Technology Metals' case is 51%. Note that a higher debt obligation increases the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of Hastings Technology Metals 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 Hastings Technology Metals, take a look at Hastings Technology Metals' company page on Simply Wall St. We've also compiled a list of essential factors you should further research:
Historical Track Record: What has Hastings Technology Metals' 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.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Hastings Technology Metals' board and the CEO’s background.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
