The NAGA Group AG (ETR:N4G): Are Analysts Optimistic?

The NAGA Group AG (ETR:N4G) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. The NAGA Group AG develops technologies for the financial sector and use of blockchain technology. With the latest financial year loss of €37m and a trailing-twelve-month loss of €20m, the €57m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on NAGA Group'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 NAGA Group

According to the 3 industry analysts covering NAGA Group, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of €3.2m in 2025. So, the company is predicted 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 58% 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.

We're not going to go through company-specific developments for NAGA Group given that this is a high-level summary, though, keep in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that NAGA Group 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. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

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

1. Valuation: What is NAGA Group 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 NAGA Group 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 NAGA Group’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.