Loss-Making Beyond Frames Entertainment AB (publ) (FRA:8WP) Expected To Breakeven In The Medium-Term

We feel now is a pretty good time to analyse Beyond Frames Entertainment AB (publ)'s (FRA:8WP) business as it appears the company may be on the cusp of a considerable accomplishment. Beyond Frames Entertainment AB (publ), a video game company, engages in the game creation and publishing business in Sweden. The €17m market-cap company posted a loss in its most recent financial year of kr7.6m and a latest trailing-twelve-month loss of kr13m leading to an even wider gap between loss and breakeven. As path to profitability is the topic on Beyond Frames Entertainment's 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.

See our latest analysis for Beyond Frames Entertainment

Beyond Frames Entertainment is bordering on breakeven, according to the 2 German Entertainment analysts. They expect the company to post a final loss in 2024, before turning a profit of kr5.0m in 2025. The company is therefore projected 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 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 112% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Beyond Frames Entertainment's growth isn’t the focus of this broad overview, though, take into account that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. Beyond Frames Entertainment currently has no debt on its balance sheet, which is rare for a loss-making growth company, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Beyond Frames Entertainment to cover in one brief article, but the key fundamentals for the company can all be found in one place – Beyond Frames Entertainment's company page on Simply Wall St. We've also compiled a list of relevant factors you should further research:

1. Valuation: What is Beyond Frames Entertainment 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 Beyond Frames Entertainment 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 Beyond Frames Entertainment’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.