Rolling Optics Holding AB (publ) (STO:RO) Is Expected To Breakeven In The Near Future

Rolling Optics Holding AB (publ) (STO:RO) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Rolling Optics Holding AB (publ) develops, designs, produces, and sells products in visual authentication based on in-house developed and patented technology in micro-optics. The kr421m market-cap company announced a latest loss of kr31m on 31 December 2020 for its most recent financial year result. Many investors are wondering about the rate at which Rolling Optics Holding 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.

View our latest analysis for Rolling Optics Holding

Expectations from some of the Swedish Commercial Services analysts is that Rolling Optics Holding is on the verge of breakeven. They expect the company to post a final loss in 2021, before turning a profit of kr800k in 2022. The company is therefore projected 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 84% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Rolling Optics Holding given that this is a high-level summary, though, keep in mind 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. Rolling Optics Holding currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

This article is not intended to be a comprehensive analysis on Rolling Optics Holding, so if you are interested in understanding the company at a deeper level, take a look at Rolling Optics Holding's company page on Simply Wall St. We've also compiled a list of relevant aspects you should look at:

1. Valuation: What is Rolling Optics Holding 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 Rolling Optics Holding 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 Rolling Optics Holding’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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