Breakeven Is Near for Fingerprint Cards AB (publ) (STO:FING B)

We feel now is a pretty good time to analyse Fingerprint Cards AB (publ)'s (STO:FING B) business as it appears the company may be on the cusp of a considerable accomplishment. Fingerprint Cards AB (publ) develops, produces, and markets biometric systems and technologies. The kr8.8b market-cap company announced a latest loss of kr341m on 31 December 2020 for its most recent financial year result. Many investors are wondering about the rate at which Fingerprint Cards 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.

See 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 2020, before turning a profit of kr3.9m in 2021. The company is therefore projected to breakeven around a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 108% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Fingerprint Cards' growth isn’t the focus of this broad overview, however, take into account that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that Fingerprint Cards 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:

There are too many aspects of Fingerprint Cards to cover in one brief article, but the key fundamentals for the company can all be found in one place – Fingerprint Cards' company page on Simply Wall St. We've also compiled a list of key factors you should look at:

1. Valuation: What is Fingerprint Cards 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 Fingerprint Cards 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 Fingerprint Cards’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. 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.
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