When Will RumbleOn, Inc. (NASDAQ:RMBL) Breakeven?

We feel now is a pretty good time to analyse RumbleOn, Inc.'s (NASDAQ:RMBL) business as it appears the company may be on the cusp of a considerable accomplishment. RumbleOn, Inc. primarily operates as a powersports retailer in the United States. With the latest financial year loss of US$214m and a trailing-twelve-month loss of US$191m, the US$204m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on RumbleOn's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for RumbleOn

According to the 4 industry analysts covering RumbleOn, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$17m in 2026. So, the company is predicted to breakeven approximately 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 86% 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.

Underlying developments driving RumbleOn's growth isn’t the focus of this broad overview, but, 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.

Before we wrap up, there’s one issue worth mentioning. RumbleOn 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. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are key fundamentals of RumbleOn 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 RumbleOn, take a look at RumbleOn's company page on Simply Wall St. We've also compiled a list of essential factors you should further research:

1. Valuation: What is RumbleOn 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 RumbleOn 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 RumbleOn’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.