Hitech & Development Wireless Sweden Holding AB (publ)'s (STO:HDW B) Profit Outlook

We feel now is a pretty good time to analyse Hitech & Development Wireless Sweden Holding AB (publ)'s (STO:HDW B) business as it appears the company may be on the cusp of a considerable accomplishment. Hitech & Development Wireless Sweden Holding AB (publ) provides technology and services within Internet of Things (IoT) and real-time location system (RTLS) in Sweden. The kr59m market-cap company’s loss lessened since it announced a kr35m loss in the full financial year, compared to the latest trailing-twelve-month loss of kr32m, as it approaches breakeven. The most pressing concern for investors is Hitech & Development Wireless Sweden Holding's path to profitability – when will it 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 Hitech & Development Wireless Sweden Holding

Expectations from some of the Swedish Communications analysts is that Hitech & Development Wireless Sweden Holding is on the verge of breakeven. They anticipate the company to incur a final loss in 2024, before generating positive profits of kr36m in 2025. Therefore, the company is expected to breakeven roughly 2 years from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 106%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Hitech & Development Wireless Sweden Holding's upcoming projects, though, take into account that by and large 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 11% 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:

This article is not intended to be a comprehensive analysis on Hitech & Development Wireless Sweden Holding, so if you are interested in understanding the company at a deeper level, take a look at Hitech & Development Wireless Sweden Holding's company page on Simply Wall St. We've also put together a list of important factors you should further research:

1. Historical Track Record: What has Hitech & Development Wireless Sweden Holding'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 Hitech & Development Wireless Sweden 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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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.