Hudson Global, Inc. (NASDAQ:HSON) On The Verge Of Breaking Even

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$30m market-cap company posted a loss in its most recent financial year of US$842k and a latest trailing-twelve-month loss of US$957k leading to an even wider gap between loss and breakeven. As path to profitability is the topic on Hudson Global's investors mind, we've decided to gauge market sentiment. 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 Hudson Global

According to some industry analysts covering Hudson Global, breakeven is near. They expect the company to post a final loss in 2020, before turning a profit of US$2.5m in 2021. The company is therefore projected to breakeven around 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 102%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Hudson Global's growth isn’t the focus of this broad overview, but, take into account that generally 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 prudently, with debt making up 4.1% 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:

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

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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