Yahoo Finance Valens Semiconductor Ltd.'s (NYSE:VLN) Shift From Loss To Profit
Valens Semiconductor Ltd. (NYSE:VLN) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Valens Semiconductor Ltd. engages in the provision of semiconductor products that enables high-speed video and data transmission for the audio-video and automotive industries. With the latest financial year loss of US$28m and a trailing-twelve-month loss of US$30m, the US$234m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Valens Semiconductor will turn a profit, with the big question being “when will the company 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 Valens Semiconductor
According to the 3 industry analysts covering Valens Semiconductor, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of US$747k in 2025. So, the company is predicted to breakeven just over a year 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 78% is expected, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Given this is a high-level overview, we won’t go into details of Valens Semiconductor's upcoming projects, however, keep in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one aspect worth mentioning. Valens Semiconductor currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high 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:
This article is not intended to be a comprehensive analysis on Valens Semiconductor, so if you are interested in understanding the company at a deeper level, take a look at Valens Semiconductor's company page on Simply Wall St. We've also put together a list of relevant aspects you should further research:
Historical Track Record: What has Valens Semiconductor'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 Valens Semiconductor'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.
