Loss-Making Huddlestock Fintech AS (OB:HUDL) Expected To Breakeven In The Medium-Term

We feel now is a pretty good time to analyse Huddlestock Fintech AS' (OB:HUDL) business as it appears the company may be on the cusp of a considerable accomplishment. Huddlestock Fintech AS, a fintech company, develops and implements software as a service-solutions for custody banks, asset managers, and trading venues. With the latest financial year loss of kr32m and a trailing-twelve-month loss of kr61m, the kr255m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Huddlestock Fintech will turn a profit, with the big question being “when will the company breakeven?” 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 Huddlestock Fintech

Huddlestock Fintech is bordering on breakeven, according to some Norwegian Capital Markets analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of kr21m in 2025. So, the company is predicted to breakeven just over a year from today. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 104% year-on-year, on average, 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 Huddlestock Fintech'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.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 15% 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 Huddlestock Fintech 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 Huddlestock Fintech, take a look at Huddlestock Fintech's company page on Simply Wall St. We've also compiled a list of relevant aspects you should look at:

1. Valuation: What is Huddlestock Fintech 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 Huddlestock Fintech 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 Huddlestock Fintech’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.