When Can We Expect A Profit From SpiderPlus & Co. (TSE:4192)?

With the business potentially at an important milestone, we thought we'd take a closer look at SpiderPlus & Co.'s (TSE:4192) future prospects. SpiderPlus & Co. engages in information and communication technology business in Japan. The JP¥13b market-cap company posted a loss in its most recent financial year of JP¥463m and a latest trailing-twelve-month loss of JP¥517m leading to an even wider gap between loss and breakeven. As path to profitability is the topic on SpiderPlus' 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.

Check out our latest analysis for SpiderPlus

According to some industry analysts covering SpiderPlus, breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of JP¥36m in 2025. The company is therefore projected 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 114% 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 SpiderPlus' 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.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 28% 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 too many aspects of SpiderPlus to cover in one brief article, but the key fundamentals for the company can all be found in one place – SpiderPlus' company page on Simply Wall St. We've also put together a list of essential aspects you should look at:

1. Valuation: What is SpiderPlus 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 SpiderPlus 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 SpiderPlus’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.