Tribune Publishing Company's (NASDAQ:TPCO) Path To Profitability

Tribune Publishing Company's (NASDAQ:TPCO): Tribune Publishing Company, together with subsidiaries, publishes newspapers worldwide. The US$350m market-cap company announced a latest loss of -US$27.3m on 29 December 2019 for its most recent financial year result. The most pressing concern for investors is TPCO’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for TPCO.

Check out our latest analysis for Tribune Publishing

Consensus from the 2 Media analysts is TPCO is on the verge of breakeven. They anticipate the company to incur a final loss in 2020, before generating positive profits of US$1.7m in 2021. TPCO is therefore projected to breakeven around a few months from now. How fast will TPCO have to grow each year in order to reach the breakeven point by 2021? Working backwards from analyst estimates, it turns out that they expect the company to grow 106% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, TPCO may become profitable much later than analysts predict.

Given this is a high-level overview, I won’t go into details of TPCO’s upcoming projects, however, bear in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before I wrap up, there’s one aspect worth mentioning. TPCO has managed its capital judiciously, with debt making up 0.02% of equity. This means that TPCO 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 TPCO, so if you are interested in understanding the company at a deeper level, take a look at TPCO’s company page on Simply Wall St. I’ve also put together a list of key factors you should further examine:

1. Valuation: What is TPCO 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 TPCO 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 Tribune Publishing’s board and the CEO’s back ground.
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. Thank you for reading.