123fahrschule SE (FRA:123F): Are Analysts Optimistic?

With the business potentially at an important milestone, we thought we'd take a closer look at 123fahrschule SE's (FRA:123F) future prospects. 123fahrschule SE engages in driving license training in the German driving school market. The €22m market-cap company announced a latest loss of €7.0m on 31 December 2024 for its most recent financial year result. As path to profitability is the topic on 123fahrschule'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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123fahrschule is bordering on breakeven, according to the 3 German Consumer Services analysts. They expect the company to post a final loss in 2026, before turning a profit of €1.3m in 2027. Therefore, the company is expected to breakeven roughly 2 years from now. 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 113%, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving 123fahrschule's growth isn’t the focus of this broad overview, though, keep in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Check out our latest analysis for 123fahrschule

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 16% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of 123fahrschule to cover in one brief article, but the key fundamentals for the company can all be found in one place – 123fahrschule's company page on Simply Wall St. We've also put together a list of pertinent aspects you should look at:

1. Valuation: What is 123fahrschule 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 123fahrschule 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 123fahrschule’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.