WALLIX GROUP SA's (EPA:ALLIX) Path To Profitability

WALLIX GROUP SA (EPA:ALLIX) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. WALLIX GROUP SA, a software company, provides cyber security solutions worldwide. The €91m market-cap company announced a latest loss of €2.9m on 31 December 2021 for its most recent financial year result. The most pressing concern for investors is WALLIX GROUP's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for WALLIX GROUP

WALLIX GROUP is bordering on breakeven, according to the 2 French Software analysts. They expect the company to post a final loss in 2023, before turning a profit of €300k in 2024. So, the company is predicted to breakeven approximately 2 years from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 37%, which signals high confidence from analysts. 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 WALLIX 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 The company has managed its capital judiciously, with debt making up 12% 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:

This article is not intended to be a comprehensive analysis on WALLIX GROUP, so if you are interested in understanding the company at a deeper level, take a look at WALLIX GROUP's company page on Simply Wall St. We've also compiled a list of pertinent factors you should further research:

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. 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.