Market Sentiment Around Loss-Making Coreo AG (ETR:CORE)

With the business potentially at an important milestone, we thought we'd take a closer look at Coreo AG's (ETR:CORE) future prospects. Coreo AG operates as a real estate company in Germany. With the latest financial year loss of €1.9m and a trailing-twelve-month loss of €1.6m, the €7.2m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Coreo'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.

View our latest analysis for Coreo

Coreo is bordering on breakeven, according to some German Capital Markets analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of €1.6m in 2025. So, the company is predicted to breakeven just over a year from today. 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 101%, 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 Coreo's upcoming projects, however, take into account that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with Coreo is its debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

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

1. Historical Track Record: What has Coreo'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 Coreo'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.