Loss-Making Titan Mining Corporation (TSE:TI) Set To Breakeven

We feel now is a pretty good time to analyse Titan Mining Corporation's (TSE:TI) business as it appears the company may be on the cusp of a considerable accomplishment. Titan Mining Corporation, a natural resources company, acquires, explores, and develops mineral properties. The company’s loss has recently broadened since it announced a US$11m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$16m, moving it further away from breakeven. As path to profitability is the topic on Titan Mining's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Titan Mining

According to some industry analysts covering Titan Mining, breakeven is near. They expect the company to post a final loss in 2020, before turning a profit of US$4.4m in 2021. Therefore, the company is expected to breakeven roughly 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 51% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Titan Mining given that this is a high-level summary, though, keep 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. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one issue worth mentioning. Titan Mining currently has a debt-to-equity ratio of 193%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

There are key fundamentals of Titan Mining 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 Titan Mining, take a look at Titan Mining's company page on Simply Wall St. We've also put together a list of pertinent aspects you should further research:

1. Valuation: What is Titan Mining 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 Titan Mining 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 Titan Mining’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.

If you decide to trade Titan Mining, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

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.