Alkami Technology, Inc. (NASDAQ:ALKT): Are Analysts Optimistic?

With the business potentially at an important milestone, we thought we'd take a closer look at Alkami Technology, Inc.'s (NASDAQ:ALKT) future prospects. Alkami Technology, Inc. offers cloud-based digital banking solutions in the United States. The US$3.4b market-cap company’s loss lessened since it announced a US$63m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$52m, as it approaches breakeven. The most pressing concern for investors is Alkami Technology's path to profitability – when will it breakeven? 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 Alkami Technology

According to the 10 industry analysts covering Alkami Technology, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$45m in 2026. The company is therefore projected to breakeven around 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 98% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for Alkami Technology given that this is a high-level summary, though, 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.

One thing we’d like to point out is that Alkami Technology 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. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

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

1. Valuation: What is Alkami Technology 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 Alkami Technology 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 Alkami Technology’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.