Breakeven Is Near for Yext, Inc. (NYSE:YEXT)

With the business potentially at an important milestone, we thought we'd take a closer look at Yext, Inc.'s (NYSE:YEXT) future prospects. Yext, Inc. provides a platform that offers answers to consumer questions in North America and internationally. The US$994m market-cap company posted a loss in its most recent financial year of US$28m and a latest trailing-twelve-month loss of US$23m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Yext 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.

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According to the 4 industry analysts covering Yext, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$21m in 2026. Therefore, the company is expected to breakeven roughly 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 46% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Yext's upcoming projects, but, take into account that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

View our latest analysis for Yext

One thing we’d like to point out is that Yext has no debt on its balance sheet, which is rare for a loss-making 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 Yext to cover in one brief article, but the key fundamentals for the company can all be found in one place – Yext's company page on Simply Wall St. We've also compiled a list of important factors you should further examine:

1. Valuation: What is Yext 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 Yext 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 Yext’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.