Breakeven On The Horizon For Hipages Group Holdings Ltd. (ASX:HPG)

Hipages Group Holdings Ltd. (ASX:HPG) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. hipages Group Holdings Limited focuses on operating as an online platform and software as a service provider in Australia. The company’s loss has recently broadened since it announced a AU$5.2m loss in the full financial year, compared to the latest trailing-twelve-month loss of AU$5.3m, moving it further away from breakeven. Many investors are wondering about the rate at which Hipages Group Holdings will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for Hipages Group Holdings

Consensus from 2 of the Australian Interactive Media and Services analysts is that Hipages Group Holdings is on the verge of breakeven. They anticipate the company to incur a final loss in 2021, before generating positive profits of AU$3.0m in 2022. So, the company is predicted to breakeven just over a year from today. How fast will the company have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 80% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won’t go into details of Hipages Group Holdings' upcoming projects, though, keep in mind that generally 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 0.07% 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 key fundamentals of Hipages Group Holdings 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 Hipages Group Holdings, take a look at Hipages Group Holdings' company page on Simply Wall St. We've also put together a list of pertinent aspects you should look at:

1. Valuation: What is Hipages Group Holdings 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 Hipages Group Holdings 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 Hipages Group Holdings’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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