Stock Analysis

Moovly Media Inc.'s (CVE:MVY) Profit Outlook

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Moovly Media Inc. (CVE:MVY) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Moovly Media Inc. develops cloud-based digital media and content creation platform in Canada and Belgium. The CA$28m market-cap company posted a loss in its most recent financial year of CA$1.7m and a latest trailing-twelve-month loss of CA$2.6m leading to an even wider gap between loss and breakeven. As path to profitability is the topic on Moovly Media'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.

View our latest analysis for Moovly Media

Moovly Media is bordering on breakeven, according to some Canadian Interactive Media and Services analysts. They anticipate the company to incur a final loss in 2021, before generating positive profits of CA$4.5m in 2022. Therefore, the company is expected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 189% year-on-year, on average, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

TSXV:MVY Earnings Per Share Growth August 19th 2021

We're not going to go through company-specific developments for Moovly Media given that this is a high-level summary, however, keep in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one issue worth mentioning. Moovly Media 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. Oftentimes, losses exist only on paper but other times, it can be a red flag.

Next Steps:

There are key fundamentals of Moovly Media 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 Moovly Media, take a look at Moovly Media's company page on Simply Wall St. We've also compiled a list of important factors you should look at:

  1. Valuation: What is Moovly Media 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 Moovly Media 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 Moovly Media’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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Valuation is complex, but we're helping make it simple.

Find out whether Moovly Media 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.

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