xijian/E+ via Getty Images
FTC Solar (NASDAQ:FTCI) -5.8% to a YTD low in Thursday's trading after reporting a slightly larger than forecast Q4 adjusted loss, prompting Roth MKM to downgrade shares to Neutral from Buy with a $0.45 price target, slashed from $2, "until we can truly see a path to the $50M-$60M of revenue required for breakeven and beyond," the firm says.
Q4 GAAP net loss fell to $11.2M, or $0.09/share, from a net loss of $20.5M, or $0.20/share in the year-ago quarter, while revenues fell 11.5% Y/Y to $23.2M, driven by lower logistics volumes.
The company said it expects Q1 revenues will fall from Q4 2023 and represent the trough for FY 2024, beyond Q1, it expects to see continued sequential revenue growth for the rest of the year, and forecasts reaching roughly breakeven on adjusted EBITDA in Q3 and becoming profitable in Q4.
Management has charted a path to profitability in the past with limited success, making FTC Solar (FTCI) a "show me" story, Roth MKM analyst Philip Shen says, adding that cash also may become an issue if the path to breakeven takes longer than expected, which he now forecasts the company will approach in H2 2025 rather than H2 2024.
Shen slashes his FY 2024 revenue estimate by more than 50% to $87M, believing there could be more project pushouts due to the challenges in utility scale solar that may cause the company to not reach the anticipated $50M quarterly run rate in the back half of the year.