When Will GreenPower Motor Company Inc. (CVE:GPV) Become Profitable?

We feel now is a pretty good time to analyse GreenPower Motor Company Inc.'s (CVE:GPV) business as it appears the company may be on the cusp of a considerable accomplishment. GreenPower Motor Company Inc. designs, manufactures, and distributes electric vehicles for commercial markets in the United States and Canada. With the latest financial year loss of US$7.8m and a trailing-twelve-month loss of US$11m, the CA$185m market-cap company amplified its loss by moving further away from its breakeven target. The most pressing concern for investors is GreenPower Motor's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for GreenPower Motor

GreenPower Motor is bordering on breakeven, according to the 5 Canadian Machinery analysts. They expect the company to post a final loss in 2023, before turning a profit of US$6.4m in 2024. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 73% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth

We're not going to go through company-specific developments for GreenPower Motor given that this is a high-level summary, but, take into account that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 12% 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 GreenPower Motor to cover in one brief article, but the key fundamentals for the company can all be found in one place – GreenPower Motor's company page on Simply Wall St. We've also put together a list of important aspects you should further examine:

1. Valuation: What is GreenPower Motor 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 GreenPower Motor is currently mispriced by the market.

2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on GreenPower Motor’s board and the CEO’s background.

3. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.