Breakeven On The Horizon For Betmakers Technology Group Ltd (ASX:BET)

We feel now is a pretty good time to analyse Betmakers Technology Group Ltd's (ASX:BET) business as it appears the company may be on the cusp of a considerable accomplishment. Betmakers Technology Group Ltd, together with its subsidiaries, provides racing data, analytics, and trading solutions in Australia. The AU$259m market-cap company posted a loss in its most recent financial year of AU$3.6m and a latest trailing-twelve-month loss of AU$2.4m shrinking the gap between loss and breakeven. The most pressing concern for investors is Betmakers Technology Group's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Betmakers Technology Group

Betmakers Technology Group is bordering on breakeven, according to the 2 Australian Hospitality analysts. They anticipate the company to incur a final loss in 2020, before generating positive profits of AU$2.9m in 2021. 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 118%, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Betmakers Technology Group's growth isn’t the focus of this broad overview, though, keep in mind that by and large 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 aspect worth mentioning. Betmakers Technology Group currently has no debt on its balance sheet, which is quite unusual for a cash-burning loss-making, growth company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Betmakers Technology Group, so if you are interested in understanding the company at a deeper level, take a look at Betmakers Technology Group's company page on Simply Wall St. We've also put together a list of relevant factors you should further research:

1. Valuation: What is Betmakers Technology Group 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 Betmakers Technology Group 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 Betmakers Technology Group’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.

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This article by Simply Wall St is general in nature. 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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