When Will RumbleON, Inc. (NASDAQ:RMBL) Turn A Profit?

With the business potentially at an important milestone, we thought we'd take a closer look at RumbleON, Inc.'s (NASDAQ:RMBL) future prospects. RumbleON, Inc., a development stage company, provides an e-commerce platform that facilitates consumers and dealers to buy, sell, trade, and finance pre-owned recreation vehicles. The US$64m market-cap company’s loss lessened since it announced a US$45m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$35m, as it approaches breakeven. As path to profitability is the topic on RumbleON'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.

See our latest analysis for RumbleON

According to the 2 industry analysts covering RumbleON, the consensus is that breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of US$5.6m in 2023. Therefore, the company is expected to breakeven roughly 3 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 75% year-on-year, on average, which signals high confidence from analysts. 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 RumbleON given that this is a high-level summary, but, take into account 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 around investing in the loss-making company.

Next Steps:

There are too many aspects of RumbleON to cover in one brief article, but the key fundamentals for the company can all be found in one place – RumbleON's company page on Simply Wall St. We've also compiled a list of key aspects you should further examine:

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. 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.
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