Argo Blockchain plc (LON:ARB): When Will It Breakeven?

We feel now is a pretty good time to analyse Argo Blockchain plc's (LON:ARB) business as it appears the company may be on the cusp of a considerable accomplishment. Argo Blockchain plc, together with its subsidiary, Argo Blockchain Canada Holdings Inc., engages in the crypto asset mining services worldwide. With the latest financial year loss of UK£869k and a trailing-twelve-month loss of UK£1.3m, the UK£30m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Argo Blockchain will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Argo Blockchain

According to some industry analysts covering Argo Blockchain, breakeven is near. They anticipate the company to incur a final loss in 2020, before generating positive profits of UK£2.4m in 2021. Therefore, the company is expected 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 180% 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.

Underlying developments driving Argo Blockchain's growth isn’t the focus of this broad overview, however, keep in mind 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 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:

There are key fundamentals of Argo Blockchain which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Argo Blockchain, take a look at Argo Blockchain's company page on Simply Wall St. We've also put together a list of pertinent factors you should further research:

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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