Breakeven On The Horizon For WALLIX GROUP SA (EPA:ALLIX)

With the business potentially at an important milestone, we thought we'd take a closer look at WALLIX GROUP SA's (EPA:ALLIX) future prospects. WALLIX GROUP SA, a software company, provides cyber security solutions worldwide. The €145m market-cap company announced a latest loss of €7.3m on 31 December 2020 for its most recent financial year result. As path to profitability is the topic on WALLIX GROUP'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.

See our latest analysis for WALLIX GROUP

According to the 2 industry analysts covering WALLIX GROUP, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2021, before generating positive profits of €1.0m in 2022. The company is therefore projected to breakeven just over a year from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 104% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for WALLIX GROUP given that this is a high-level summary, however, take into account 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 14% 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 WALLIX GROUP to cover in one brief article, but the key fundamentals for the company can all be found in one place – WALLIX GROUP's company page on Simply Wall St. We've also compiled a list of important aspects you should further examine:

1. Valuation: What is WALLIX 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 WALLIX 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 WALLIX 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. 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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