Breakeven On The Horizon For Keypath Education International, Inc. (ASX:KED)

We feel now is a pretty good time to analyse Keypath Education International, Inc.'s (ASX:KED) business as it appears the company may be on the cusp of a considerable accomplishment. Keypath Education International, Inc. designs, develops, and delivers career-relevant online education solutions in North America, the Asia-Pacific, and internationally. The AU$84m market-cap company announced a latest loss of US$20m on 30 June 2023 for its most recent financial year result. The most pressing concern for investors is Keypath Education International's path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for Keypath Education International

Consensus from 4 of the Australian Consumer Services analysts is that Keypath Education International is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$4.6m in 2026. So, the company is predicted to breakeven approximately 2 years from now. 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 68%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Keypath Education International's upcoming projects, however, keep in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. Keypath Education International currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

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

1. Valuation: What is Keypath Education International 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 Keypath Education International 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 Keypath Education International’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. 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.