EverCommerce Inc. (NASDAQ:EVCM) Is Expected To Breakeven In The Near Future

EverCommerce Inc. (NASDAQ:EVCM) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. EverCommerce Inc., together with its subsidiaries, provides integrated software-as-a-service solutions for service-based small and medium sized businesses in the United States and internationally. The US$1.8b market-cap company posted a loss in its most recent financial year of US$46m and a latest trailing-twelve-month loss of US$41m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which EverCommerce will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for EverCommerce

EverCommerce is bordering on breakeven, according to the 12 American Software analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$25m in 2025. Therefore, the company is expected to breakeven just over a year from today. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 110% 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.

We're not going to go through company-specific developments for EverCommerce given that this is a high-level summary, but, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with EverCommerce is its relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in EverCommerce's case is 66%. 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 key fundamentals of EverCommerce 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 EverCommerce, take a look at EverCommerce's company page on Simply Wall St. We've also compiled a list of essential aspects you should further examine:

1. Valuation: What is EverCommerce 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 EverCommerce 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 EverCommerce’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com