When Will The NAGA Group AG (ETR:N4G) Become Profitable?
With the business potentially at an important milestone, we thought we'd take a closer look at The NAGA Group AG's (ETR:N4G) future prospects. The NAGA Group AG develops technologies for the financial sector and use of blockchain technology. With the latest financial year loss of €10m and a trailing-twelve-month loss of €26m, the €102m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which NAGA Group will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
See our latest analysis for NAGA Group
According to the 2 industry analysts covering NAGA Group, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of €5.6m in 2025. The company is therefore projected to breakeven around 2 years from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 67% is expected, which signals high confidence from analysts. 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 NAGA Group's upcoming projects, though, keep in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we’d like to point out is that NAGA Group has no debt on its balance sheet, which is rare for a loss-making growth company, which usually has a high level of 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.
There are too many aspects of NAGA Group to cover in one brief article, but the key fundamentals for the company can all be found in one place – NAGA Group's company page on Simply Wall St. We've also put together a list of relevant aspects you should further research:
Valuation: What is NAGA Group 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 NAGA Group is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on NAGA Group’s board and the CEO’s background.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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