Concordia Maritime AB (publ) (STO:CCOR B) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Concordia Maritime AB (publ) operates as a tanker shipping company in Sweden and internationally. On 31 December 2020, the kr454m market-cap company posted a loss of kr66m for its most recent financial year. As path to profitability is the topic on Concordia Maritime’s investors mind, we’ve decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.
Concordia Maritime is bordering on breakeven, according to some Swedish Oil and Gas analysts. They expect the company to post a final loss in 2021, before turning a profit of kr49m in 2022. The company is therefore projected to breakeven just over a year 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 62%, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
We’re not going to go through company-specific developments for Concordia Maritime given that this is a high-level summary, though, take into account that typically energy companies, depending on the stage of operation and resource produced, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
One thing we would like to bring into light with Concordia Maritime is its debt-to-equity ratio of 121%. Typically, debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk around investing in the loss-making company.
There are key fundamentals of Concordia Maritime 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 Concordia Maritime, take a look at Concordia Maritime’s company page on Simply Wall St. We’ve also compiled a list of key factors you should look at:
- Valuation: What is Concordia Maritime 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 Concordia Maritime is currently mispriced by the market.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Concordia Maritime’s 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. 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.
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