Asure Software Inc’s (NASDAQ:ASUR) Path To Profitability

Asure Software Inc’s (NASDAQ:ASUR): Asure Software Inc. provides cloud-based software-as-a-service time and labor management, and workspace management solutions worldwide. The US$233.39m market-cap posted a loss in its most recent financial year of -US$5.72m and a latest trailing-twelve-month loss of -US$6.59m leading to an even wider gap between loss and breakeven. Many investors are wondering the rate at which ASUR will turn a profit, with the big question being “when will the company breakeven?” Below I will provide a high-level summary of the industry analysts’ expectations for ASUR.

See our latest analysis for Asure Software

According to the industry analysts covering ASUR, breakeven is near. They anticipate the company to incur a final loss in 2018, before generating positive profits of US$1.23m in 2019. So, ASUR is predicted to breakeven approximately a few months from now. How fast will ASUR have to grow each year in order to reach the breakeven point by 2019? Working backwards from analyst estimates, it turns out that they expect the company to grow 106.64% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, ASUR may become profitable much later than analysts predict.

NasdaqCM:ASUR Past Future Earnings June 15th 18
NasdaqCM:ASUR Past Future Earnings June 15th 18

Underlying developments driving ASUR’s growth isn’t the focus of this broad overview, however, keep in mind that typically 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 issue worth mentioning. ASUR currently has a debt-to-equity ratio of 180.86%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in ASUR’s case, it has significantly overshot. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on ASUR, so if you are interested in understanding the company at a deeper level, take a look at ASUR’s company page on Simply Wall St. I’ve also compiled a list of key aspects you should further research:

  1. Valuation: What is ASUR 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 ASUR 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 Asure Software’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.