ContextLogic Inc. (NASDAQ:LOGC) Is Expected To Breakeven In The Near Future

With the business potentially at an important milestone, we thought we'd take a closer look at ContextLogic Inc.'s ( NASDAQ:LOGC ) future prospects. The US$212m market-cap company’s loss lessened since it announced a US$317m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$141m, as it approaches breakeven. As path to profitability is the topic on ContextLogic's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for ContextLogic

Expectations from some of the American Multiline Retail analysts is that ContextLogic is on the verge of breakeven. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$3.9m in 2025. The company is therefore projected to breakeven just over a year from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 107%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of ContextLogic's upcoming projects, however, take into account 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 aspect worth mentioning. ContextLogic currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

There are key fundamentals of ContextLogic 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 ContextLogic, take a look at ContextLogic's company page on Simply Wall St . We've also put together a list of important factors you should further examine:

1. Historical Track Record : What has ContextLogic's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team : An experienced management team on the helm increases our confidence in the business – take a look at who sits on ContextLogic'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.