MJ Hudson Group plc (LON:MJH) Could Be Less Than A Year Away From Profitability

We feel now is a pretty good time to analyse MJ Hudson Group plc's (LON:MJH) business as it appears the company may be on the cusp of a considerable accomplishment. MJ Hudson Group plc operates as a financial services support provider for the fund managers and asset owners in the United Kingdom, the Channel Islands, Switzerland, Netherlands, Luxembourg, rest of Europe, North America, the Cayman Islands, and internationally. The UK£81m market-cap company’s loss lessened since it announced a UK£7.2m loss in the full financial year, compared to the latest trailing-twelve-month loss of UK£6.2m, as it approaches breakeven. The most pressing concern for investors is MJ Hudson Group's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for MJ Hudson Group

According to the 3 industry analysts covering MJ Hudson Group, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2020, before generating positive profits of UK£150k in 2021. So, the company is predicted to breakeven approximately a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 154% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of MJ Hudson Group's upcoming projects, but, 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 8.7% 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 MJ Hudson Group, so if you are interested in understanding the company at a deeper level, take a look at MJ Hudson Group's company page on Simply Wall St. We've also compiled a list of key factors you should further examine:

1. Historical Track Record: What has MJ Hudson Group's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on MJ Hudson 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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