Analysts Expect Digitalbox plc (LON:DBOX) To Breakeven Soon

With the business potentially at an important milestone, we thought we'd take a closer look at Digitalbox plc's (LON:DBOX) future prospects. Digitalbox Publishing Ltd creates digital marketing campaigns. The UK£7.7m market-cap company announced a latest loss of UK£191k on 31 December 2020 for its most recent financial year result. As path to profitability is the topic on Digitalbox'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.

View our latest analysis for Digitalbox

Digitalbox is bordering on breakeven, according to some British Interactive Media and Services analysts. They expect the company to post a final loss in 2020, before turning a profit of UK£282k in 2021. Therefore, the company is expected to breakeven roughly 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 72%, 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 Digitalbox given that this is a high-level summary, though, take into account that generally 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 3.9% 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 Digitalbox, so if you are interested in understanding the company at a deeper level, take a look at Digitalbox's company page on Simply Wall St. We've also put together a list of key aspects you should further research:

1. Valuation: What is Digitalbox 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 Digitalbox 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 Digitalbox’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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