Yahoo Finance Market Sentiment Around Loss-Making Trican Well Service Ltd. (TSE:TCW)
Trican Well Service Ltd. (TSE:TCW) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Trican Well Service Ltd., an equipment services company, provides various specialized products, equipment, services, and technology for use in the drilling, completion, stimulation, and reworking of oil and gas wells primarily in Canada. The CA$871m market-cap company’s loss lessened since it announced a CA$233m loss in the full financial year, compared to the latest trailing-twelve-month loss of CA$58m, as it approaches breakeven. As path to profitability is the topic on Trican Well Service'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.
See our latest analysis for Trican Well Service
According to the 9 industry analysts covering Trican Well Service, the consensus is that breakeven is near. They expect the company to post a final loss in 2021, before turning a profit of CA$37m in 2022. Therefore, the company is expected 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 108%, 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 Trican Well Service given that this is a high-level summary, though, keep in mind that generally energy companies, depending on the stage of operation and resource produced, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
Before we wrap up, there’s one aspect worth mentioning. Trican Well Service currently has no debt on its balance sheet, which is rare for a loss-making oil and gas company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.
Next Steps:
There are too many aspects of Trican Well Service to cover in one brief article, but the key fundamentals for the company can all be found in one place – Trican Well Service's company page on Simply Wall St. We've also compiled a list of relevant factors you should further examine:
Valuation: What is Trican Well Service 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 Trican Well Service 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 Trican Well Service’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.
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.
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