Stock Analysis

Market Sentiment Around Loss-Making Elys Game Technology, Corp. (NASDAQ:ELYS)

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We feel now is a pretty good time to analyse Elys Game Technology, Corp.'s (NASDAQ:ELYS) business as it appears the company may be on the cusp of a considerable accomplishment. Elys Game Technology, Corp. provides online and land-based gaming services in Europe and North America. With the latest financial year loss of US$9.9m and a trailing-twelve-month loss of US$13m, the US$70m market-cap company amplified its loss by moving further away from its breakeven target. The most pressing concern for investors is Elys Game Technology'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 Elys Game Technology

According to the 4 industry analysts covering Elys Game Technology, the consensus is that breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of US$8.1m in 2023. The company is therefore projected to breakeven around 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 97% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

NasdaqCM:ELYS Earnings Per Share Growth December 30th 2021

Given this is a high-level overview, we won’t go into details of Elys Game Technology's upcoming projects, though, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 0.9% 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 Elys Game Technology, so if you are interested in understanding the company at a deeper level, take a look at Elys Game Technology's company page on Simply Wall St. We've also compiled a list of essential factors you should look at:

  1. Valuation: What is Elys Game Technology 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 Elys Game Technology 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 Elys Game Technology’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.

Valuation is complex, but we're helping make it simple.

Find out whether Elys Game Technology is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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