Hudson Global, Inc. (NASDAQ:HSON) Is About To Turn The Corner

With the business potentially at an important milestone, we thought we'd take a closer look at Hudson Global, Inc.'s (NASDAQ:HSON) future prospects. Hudson Global, Inc. provides talent solutions for mid-to-large-cap multinational companies and government agencies under the Hudson RPO brand in the Americas, the Asia Pacific, and Europe. The US$51m market-cap company announced a latest loss of US$1.2m on 31 December 2020 for its most recent financial year result. The most pressing concern for investors is Hudson Global's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

View our latest analysis for Hudson Global

Hudson Global is bordering on breakeven, according to some American Professional Services analysts. They anticipate the company to incur a final loss in 2020, before generating positive profits of US$2.6m in 2021. 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 92%, which signals high confidence from analysts. 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 Hudson Global's upcoming projects, however, bear in mind that typically 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 Hudson Global has no debt on its balance sheet, which is rare for a loss-making growth company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Hudson Global 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 Hudson Global, take a look at Hudson Global's company page on Simply Wall St. We've also put together a list of essential aspects you should further examine:

1. Valuation: What is Hudson Global 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 Hudson Global 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 Hudson Global’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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