The Liberty Braves Group's (NASDAQ:BATR.K) Path To Profitability

We feel now is a pretty good time to analyse The Liberty Braves Group's (NASDAQ:BATR.K) business as it appears the company may be on the cusp of a considerable accomplishment. The Liberty Braves Group, through its subsidiary, Braves Holdings, LLC, owns the Atlanta Braves Major League Baseball Club, various assets and liabilities associated with ANLBC’s stadium, and mixed-use development project. The US$2.0b market-cap company posted a loss in its most recent financial year of US$35m and a latest trailing-twelve-month loss of US$81m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which Liberty Braves Group will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Liberty Braves Group

According to the 4 industry analysts covering Liberty Braves Group, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of US$17m in 2025. Therefore, the company is expected to breakeven roughly 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 74% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won’t go into details of Liberty Braves Group's upcoming projects, however, take into account that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one issue worth mentioning. Liberty Braves Group currently has a debt-to-equity ratio of over 2x. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Liberty Braves Group, so if you are interested in understanding the company at a deeper level, take a look at Liberty Braves Group's company page on Simply Wall St. We've also put together a list of relevant aspects you should look at:

1. Valuation: What is Liberty Braves Group 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 Liberty Braves Group 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 Liberty Braves Group’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.