Argo Blockchain plc (LON:ARB) On The Verge Of Breaking Even

With the business potentially at an important milestone, we thought we'd take a closer look at Argo Blockchain plc's (LON:ARB) future prospects. Argo Blockchain plc, together with its subsidiary, Argo Blockchain Canada Holdings Inc., engages in the crypto asset mining services worldwide. The UK£943m market-cap company posted a loss in its most recent financial year of UK£869k and a latest trailing-twelve-month loss of UK£1.3m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is Argo Blockchain's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

View our latest analysis for Argo Blockchain

Argo Blockchain is bordering on breakeven, according to some British Software analysts. They expect the company to post a final loss in 2020, before turning a profit of UK£2.4m 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 180% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Argo Blockchain's growth isn’t the focus of this broad overview, however, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 1.4% 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 Argo Blockchain, so if you are interested in understanding the company at a deeper level, take a look at Argo Blockchain's company page on Simply Wall St. We've also put together a list of important aspects you should look at:

1. Valuation: What is Argo Blockchain 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 Argo Blockchain 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 Argo Blockchain’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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