We feel now is a pretty good time to analyse Impinj, Inc.'s (NASDAQ:PI) business as it appears the company may be on the cusp of a considerable accomplishment. Impinj, Inc. operates a cloud connectivity platform in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. With the latest financial year loss of US$24m and a trailing-twelve-month loss of US$18m, the US$2.5b market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Impinj's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

See our latest analysis for Impinj

Impinj is bordering on breakeven, according to the 7 American Semiconductor analysts. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$14m in 2024. Therefore, the company is expected to breakeven just over a year from today. 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 109% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Impinj's growth isn’t the focus of this broad overview, but, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with Impinj is its debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Impinj which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Impinj, take a look at Impinj's company page on Simply Wall St. We've also put together a list of pertinent aspects you should further examine:

1. Historical Track Record: What has Impinj'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 Impinj'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.

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