We feel now is a pretty good time to analyse Whispir Limited's (ASX:WSP) business as it appears the company may be on the cusp of a considerable accomplishment. Whispir Limited develops and provides communications management systems through cloud-based platform in the Americas, Australia, New Zealand, Singapore, Switzerland, and internationally. With the latest financial year loss of AU$9.9m and a trailing-twelve-month loss of AU$7.3m, the AU$456m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Whispir will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
According to the 5 industry analysts covering Whispir, the consensus is that breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of AU$8.0m in 2024. The company is therefore projected to breakeven around 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 60%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving Whispir's growth isn’t the focus of this broad overview, however, take into account that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we’d like to point out is that Whispir 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. 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.
There are key fundamentals of Whispir 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 Whispir, take a look at Whispir's company page on Simply Wall St. We've also compiled a list of pertinent factors you should further examine:
- Historical Track Record: What has Whispir'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.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Whispir's board and the CEO’s background.
- 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.
When trading Whispir or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted
Valuation is complex, but we're helping make it simple.
Find out whether Whispir is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.View the Free Analysis
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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.