When Can We Expect A Profit From Montage Gold Corp. (TSE:MAU)?

With the business potentially at an important milestone, we thought we'd take a closer look at Montage Gold Corp.'s (TSE:MAU) future prospects. Montage Gold Corp. engages in the acquisition, exploration, and development of mineral properties in Africa. With the latest financial year loss of US$47m and a trailing-twelve-month loss of US$68m, the CA$1.6b market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on Montage Gold'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.

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According to the 5 industry analysts covering Montage Gold, the consensus is that breakeven is near. They expect the company to post a final loss in 2026, before turning a profit of US$227m in 2027. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 113% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Montage Gold's growth isn’t the focus of this broad overview, but, bear in mind that typically a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

See our latest analysis for Montage Gold

Before we wrap up, there’s one aspect worth mentioning. Montage Gold currently has no debt on its balance sheet, which is rare for a loss-making metals and mining company, which usually has a high level of 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.

Next Steps:

There are too many aspects of Montage Gold to cover in one brief article, but the key fundamentals for the company can all be found in one place – Montage Gold's company page on Simply Wall St. We've also compiled a list of pertinent factors you should further research:

1. Historical Track Record: What has Montage Gold'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 Montage Gold'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.