Analysts Are Optimistic We'll See A Profit From Fingerprint Cards AB (publ) (STO:FING B)

By
Simply Wall St
Published
January 22, 2022
OM:FING B
Source: Shutterstock

Fingerprint Cards AB (publ) (STO:FING B) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Fingerprint Cards AB (publ) develops, produces, and markets biometric systems and technologies. With the latest financial year loss of kr341m and a trailing-twelve-month loss of kr319m, the kr5.2b market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Fingerprint Cards' investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Fingerprint Cards

Expectations from some of the Swedish Electronic analysts is that Fingerprint Cards is on the verge of breakeven. They expect the company to post a final loss in 2021, before turning a profit of kr117m in 2022. Therefore, the company is expected to breakeven roughly a year from now or less! At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 123%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
OM:FING B Earnings Per Share Growth January 22nd 2022

Underlying developments driving Fingerprint Cards' growth isn’t the focus of this broad overview, however, bear in mind that generally 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. Fingerprint Cards currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of 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 Fingerprint Cards, so if you are interested in understanding the company at a deeper level, take a look at Fingerprint Cards' company page on Simply Wall St. We've also put together a list of essential factors you should further research:

  1. Historical Track Record: What has Fingerprint Cards' 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 Fingerprint Cards' 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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