Analysts Expect Breakeven For Credit Clear Limited (ASX:CCR) Before Long

With the business potentially at an important milestone, we thought we'd take a closer look at Credit Clear Limited's (ASX:CCR) future prospects. Credit Clear Limited engages in the development and implementation of receivables management platform, and provision of receivable collection services. The AU$111m market-cap company’s loss lessened since it announced a AU$11m loss in the full financial year, compared to the latest trailing-twelve-month loss of AU$5.9m, as it approaches breakeven. As path to profitability is the topic on Credit Clear'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.

View our latest analysis for Credit Clear

According to the 2 industry analysts covering Credit Clear, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of AU$150k in 2025. The company is therefore projected to breakeven just over a year 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 109%, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for Credit Clear given that this is a high-level summary, 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.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 1.1% 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:

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

1. Valuation: What is Credit Clear 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 Credit Clear 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 Credit Clear’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com