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

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. On 31 March 2024, the CA$38m market-cap company posted a loss of US$18m for its most recent financial year. 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.

View our latest analysis for GreenPower Motor

GreenPower Motor is bordering on breakeven, according to the 3 Canadian Machinery analysts. They expect the company to post a final loss in 2025, before turning a profit of US$1.9m in 2026. 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 95% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth

Underlying developments driving GreenPower Motor's growth isn’t the focus of this broad overview, however, bear in mind 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 would like to bring into light with GreenPower Motor is its debt-to-equity ratio of 105%. 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.

Next Steps:

This article is not intended to be a comprehensive analysis on GreenPower Motor, so if you are interested in understanding the company at a deeper level, take a look at GreenPower Motor's company page on Simply Wall St. We've also put together a list of important factors you should further research:

1. Historical Track Record: What has GreenPower Motor's 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.

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.

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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