Poseidon Nickel Limited (ASX:POS) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Poseidon Nickel Limited engages in the exploration, development, mining, and production of nickel and other mineral properties in Australia. The AU$199m market-cap company’s loss lessened since it announced a AU$11m loss in the full financial year, compared to the latest trailing-twelve-month loss of AU$11m, as it approaches breakeven. As path to profitability is the topic on Poseidon Nickel's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Poseidon Nickel

Poseidon Nickel is bordering on breakeven, according to some Australian Metals and Mining analysts. They expect the company to post a final loss in 2022, before turning a profit of AU$16m in 2023. The company is therefore projected to breakeven just over a year from now. 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 114%, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict. earnings-per-share-growth

We're not going to go through company-specific developments for Poseidon Nickel given that this is a high-level summary, though, take into account that generally metals and mining companies, depending on the stage of operation and metals mined, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one aspect worth mentioning. Poseidon Nickel currently has no debt on its balance sheet, which is rare for a loss-making metals and mining company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.



Next Steps:

There are too many aspects of Poseidon Nickel to cover in one brief article, but the key fundamentals for the company can all be found in one place – Poseidon Nickel's company page on Simply Wall St. We've also compiled a list of key aspects you should further research:

Historical Track Record: What has Poseidon Nickel'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. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Poseidon Nickel'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. 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.