When Can We Expect A Profit From ESTsoft Corp. (KOSDAQ:047560)?

ESTsoft Corp. (KOSDAQ:047560) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. ESTsoft Corp. engages in the software business in South Korea. With the latest financial year loss of ₩12b and a trailing-twelve-month loss of ₩11b, the ₩172b market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which ESTsoft 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.

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ESTsoft is bordering on breakeven, according to the 2 South Korean Software analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of ₩4.7b in 2026. So, the company is predicted to breakeven just over a year 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 121% 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 ESTsoft's growth isn’t the focus of this broad overview, but, 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.

View our latest analysis for ESTsoft

Before we wrap up, there’s one issue worth mentioning. ESTsoft currently has a relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in ESTsoft's case is 44%. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of ESTsoft 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 ESTsoft, take a look at ESTsoft's company page on Simply Wall St. We've also put together a list of relevant aspects you should further research:

1. Historical Track Record: What has ESTsoft's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on ESTsoft'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.