When Will Raiz Invest Limited (ASX:RZI) Breakeven?

With the business potentially at an important milestone, we thought we'd take a closer look at Raiz Invest Limited's (ASX:RZI) future prospects. Raiz Invest Limited provides financial services and products through its mobile micro-investing platform in Australia, Indonesia, and Malaysia. The AU$42m market-cap company announced a latest loss of AU$6.9m on 30 June 2023 for its most recent financial year result. The most pressing concern for investors is Raiz Invest'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 Raiz Invest

Raiz Invest is bordering on breakeven, according to some Australian Capital Markets analysts. They expect the company to post a final loss in 2025, before turning a profit of AU$1.2m in 2026. So, the company is predicted to breakeven approximately 3 years 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 105%, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Raiz Invest'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.

One thing we’d like to point out is that Raiz Invest has no debt on its balance sheet, which is rare for a loss-making growth company, which typically has high 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:

There are key fundamentals of Raiz Invest which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Raiz Invest, take a look at Raiz Invest's company page on Simply Wall St. We've also put together a list of important factors you should look at:

1. Historical Track Record: What has Raiz Invest's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Raiz Invest'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.