LiveOne, Inc. (NASDAQ:LVO) Is Expected To Breakeven In The Near Future

We feel now is a pretty good time to analyse LiveOne, Inc.'s (NASDAQ:LVO) business as it appears the company may be on the cusp of a considerable accomplishment. LiveOne, Inc., a digital media company, engages in the acquisition, distribution, and monetization of live music, Internet radio, podcasting/vodcasting, and music-related streaming and video content. The US$157m market-cap company announced a latest loss of US$12m on 31 March 2024 for its most recent financial year result. As path to profitability is the topic on LiveOne's investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.

View our latest analysis for LiveOne

Consensus from 5 of the American Entertainment analysts is that LiveOne is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of US$3.5m in 2026. So, the company is predicted to breakeven approximately 2 years from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 101% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for LiveOne given that this is a high-level summary, however, keep in mind 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 issue worth mentioning. LiveOne currently has a debt-to-equity ratio of 124%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of LiveOne 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 LiveOne, take a look at LiveOne'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 LiveOne 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 LiveOne 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 LiveOne’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com