Bluechiip Limited's (ASX:BCT): Bluechiip Limited develops and commercializes wireless tracking solutions for the healthcare and life science, security, defense, and manufacturing industries. The AU$88m market-cap company announced a latest loss of -AU$3.3m on 30 June 2019 for its most recent financial year result. As path to profitability is the topic on BCT’s investors mind, I’ve decided to gauge market sentiment. Below I will provide a high-level summary of the industry analysts’ expectations for BCT.
Expectation from Electronic analysts is BCT is on the verge of breakeven. They anticipate the company to incur a final loss in 2021, before generating positive profits of AU$500k in 2022. BCT is therefore projected to breakeven around 3 years from today. In order to meet this breakeven date, I calculated the rate at which BCT must grow year-on-year. It turns out an average annual growth rate of 62% 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.
I’m not going to go through company-specific developments for BCT given that this is a high-level summary, however, take into account 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 aspect worth mentioning. BCT currently has no debt on its balance sheet, which is quite unusual for a cash-burning loss-making, growth company, which usually has a high level of debt relative to its equity. BCT currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
There are key fundamentals of BCT 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 BCT, take a look at BCT’s company page on Simply Wall St. I’ve also put together a list of important factors you should further research:
- Historical Track Record: What has BCT's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Bluechiip’s board and the CEO’s back ground.
- 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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