We Might See A Profit From Lloyd Fonds AG (ETR:L1OA) Soon

With the business potentially at an important milestone, we thought we'd take a closer look at Lloyd Fonds AG's (ETR:L1OA) future prospects. Lloyd Fonds AG, together with its subsidiaries, develops, arranges, initiates, and markets investment products for private and institutional investors in Germany and Singapore. On 31 December 2020, the €109m market-cap company posted a loss of €703k for its most recent financial year. As path to profitability is the topic on Lloyd Fonds' investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Lloyd Fonds

According to the 4 industry analysts covering Lloyd Fonds, the consensus is that breakeven is near. They expect the company to post a final loss in 2020, before turning a profit of €350k in 2021. Therefore, the company is expected to breakeven roughly a year 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 89% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for Lloyd Fonds given that this is a high-level summary, but, 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 aspect worth mentioning. The company has managed its capital prudently, with debt making up 24% 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 Lloyd Fonds to cover in one brief article, but the key fundamentals for the company can all be found in one place – Lloyd Fonds' company page on Simply Wall St. We've also put together a list of key factors you should further research:

1. Historical Track Record: What has Lloyd Fonds' 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 Lloyd Fonds' 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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