When Will Bank of Cyprus Holdings Public Limited Company (CSE:BOCH) Turn A Profit?

With the business potentially at an important milestone, we thought we'd take a closer look at Bank of Cyprus Holdings Public Limited Company's (CSE:BOCH) future prospects. Bank of Cyprus Holdings Public Limited Company, through its subsidiaries, provides banking, financial, and insurance services to individuals, small and medium sized enterprises, and corporate customers. The company’s loss has recently broadened since it announced a €70m loss in the full financial year, compared to the latest trailing-twelve-month loss of €307m, moving it further away from breakeven. As path to profitability is the topic on Bank of Cyprus Holdings' 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 Bank of Cyprus Holdings

According to the 4 industry analysts covering Bank of Cyprus Holdings, the consensus is that breakeven is near. They expect the company to post a final loss in 2021, before turning a profit of €102m in 2022. Therefore, the company is expected to breakeven roughly 2 years from today. 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 82% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Bank of Cyprus Holdings' upcoming projects, but, take into account that typically 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. Bank of Cyprus Holdings currently has a relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Bank of Cyprus Holdings' case is 66%. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Bank of Cyprus Holdings 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 Bank of Cyprus Holdings, take a look at Bank of Cyprus Holdings' company page on Simply Wall St. We've also put together a list of relevant factors you should look at:

1. Historical Track Record: What has Bank of Cyprus Holdings' 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 Bank of Cyprus Holdings' 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. 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.
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