We feel now is a pretty good time to analyse Rubean AG's (FRA:R1B) business as it appears the company may be on the cusp of a considerable accomplishment. Rubean AG provides software-only point-of-sale solutions to banks, acquirers, and merchants. On 31 December 2020, the €18m market-cap company posted a loss of €724k for its most recent financial year. As path to profitability is the topic on Rubean's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
According to some industry analysts covering Rubean, breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of €900k in 2023. 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 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 31% 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 Rubean given that this is a high-level summary, but, bear in mind that by and large 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 Rubean 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.
This article is not intended to be a comprehensive analysis on Rubean, so if you are interested in understanding the company at a deeper level, take a look at Rubean's company page on Simply Wall St. We've also put together a list of relevant factors you should look at:
- Valuation: What is Rubean 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 Rubean is currently mispriced by the market.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Rubean’s board and the CEO’s background.
- 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.
Valuation is complex, but we're helping make it simple.
Find out whether Rubean is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.View the Free Analysis
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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.
Rubean AG provides software-only point-of-sale solutions to banks, acquirers, and merchants.
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High growth potential with mediocre balance sheet.