Westrock Coffee Company (NASDAQ:WEST) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Westrock Coffee Company, LLC operates as an integrated coffee, tea, flavors, extracts, and ingredients solutions provider in the United States and internationally. The company’s loss has recently broadened since it announced a US$35m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$45m, moving it further away from breakeven. The most pressing concern for investors is Westrock Coffee's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Westrock Coffee

Consensus from 4 of the American Food analysts is that Westrock Coffee is on the verge of breakeven. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$13m in 2025. The company is therefore projected 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 is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Westrock Coffee's growth isn’t the focus of this broad overview, though, 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.

Before we wrap up, there’s one issue worth mentioning. Westrock Coffee currently has a debt-to-equity ratio of 133%. Generally, the rule of thumb is 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:

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

1. Valuation: What is Westrock Coffee 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 Westrock Coffee is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Westrock Coffee’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.