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Analysts Expect Breakeven For Bilibili Inc. (NASDAQ:BILI)

Kyle Sanford

Bilibili Inc.’s (NASDAQ:BILI): Bilibili Inc. provides online entertainment services for the young generations in the People’s Republic of China. With the latest financial year loss of -CN¥959.3m and a trailing-twelve month of -CN¥943.4m, the US$3.8b market-cap alleviates its loss by moving closer towards its target of breakeven. Many investors are wondering the rate at which BILI 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 BILI.

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BILI is bordering on breakeven, according to the 9 Entertainment analysts. They anticipate the company to incur a final loss in 2019, before generating positive profits of CN¥302m in 2020. So, BILI is predicted to breakeven approximately a couple of months from now! How fast will BILI have to grow each year in order to reach the breakeven point by 2020? Working backwards from analyst estimates, it turns out that they expect the company to grow 87% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

NasdaqGS:BILI Past Future Earnings January 15th 19

I’m not going to go through company-specific developments for BILI given that this is a high-level summary, though, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing I’d like to point out is that BILI has no debt on its balance sheet, which is quite unusual for a cash-burning loss-making, growth company, which typically has high debt relative to its equity. This means that BILI 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 key fundamentals of BILI which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at BILI, take a look at BILI’s company page on Simply Wall St. I’ve also put together a list of pertinent aspects you should further research:

  1. Valuation: What is BILI 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 BILI 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 Bilibili’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.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.