Analysts Expect Kleos Space S.A. (ASX:KSS) To Breakeven Soon

With the business potentially at an important milestone, we thought we'd take a closer look at Kleos Space S.A.'s (ASX:KSS) future prospects. Kleos Space S.A., together with its subsidiaries, engages in the development of the space enabled, activity-based intelligence, and data-as-a-service (DaaS) products in Luxembourg and internationally. The AU$131m market-cap company announced a latest loss of €4.9m on 31 December 2020 for its most recent financial year result. As path to profitability is the topic on Kleos Space's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Kleos Space

According to some industry analysts covering Kleos Space, breakeven is near. They expect the company to post a final loss in 2020, before turning a profit of €941k in 2021. The company is therefore projected to breakeven around 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2021? Working backwards from analyst estimates, it turns out that they expect the company to grow 137% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Kleos Space given that this is a high-level summary, however, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 29% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

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

1. Valuation: What is Kleos Space 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 Kleos Space 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 Kleos Space’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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