Breakeven Is Near for Pointerra Limited (ASX:3DP)

With the business potentially at an important milestone, we thought we'd take a closer look at Pointerra Limited's (ASX:3DP) future prospects. Pointerra Limited provides a cloud-based solution for storing, processing, managing, analyzing, extracting, visualizing, and sharing 3D data. The AU$43m market-cap company announced a latest loss of AU$5.2m on 30 June 2024 for its most recent financial year result. As path to profitability is the topic on Pointerra's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Pointerra

Expectations from some of the Australian Software analysts is that Pointerra is on the verge of breakeven. They anticipate the company to incur a final loss in 2024, before generating positive profits of AU$2.1m in 2025. The company is therefore projected to breakeven around a year from now or less! At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 126%, 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 Pointerra's growth isn’t the focus of this broad overview, though, bear 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 would like to bring into light with Pointerra is it currently has negative equity on its balance sheet. This can sometimes arise from accounting methods used to deal with accumulated losses from prior years, which are viewed as liabilities carried forward until it cancels out in the future. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

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

1. Valuation: What is Pointerra 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 Pointerra 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 Pointerra’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.