Analysts Expect Breakeven For G Rent S.p.A. (BIT:GSR) Before Long

G Rent S.p.A. (BIT:GSR) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. G Rent SpA provides services to investors, developers, and private customers for the outsourcing of real estate units intended for short rent. The €3.1m market-cap company posted a loss in its most recent financial year of €1.1m and a latest trailing-twelve-month loss of €976k shrinking the gap between loss and breakeven. As path to profitability is the topic on G Rent's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for G Rent

Expectations from some of the Italian Real Estate analysts is that G Rent is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of €100k in 2026. The company is therefore projected to breakeven around 2 years from now. 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 107% is expected, which is extremely buoyant. 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 G Rent's upcoming projects, however, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with G Rent is its debt-to-equity ratio of 121%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on G Rent, so if you are interested in understanding the company at a deeper level, take a look at G Rent's company page on Simply Wall St. We've also put together a list of key aspects you should further examine:

1. Valuation: What is G Rent 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 G Rent 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 G Rent’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.