When Will Clear Secure, Inc. (NYSE:YOU) Become Profitable?
Clear Secure, Inc. (NYSE:YOU) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Clear Secure, Inc. provides a member-centric secure identity platform in the United States. The company’s loss has recently broadened since it announced a US$36m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$71m, moving it further away from breakeven. Many investors are wondering about the rate at which Clear Secure will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
View our latest analysis for Clear Secure
Consensus from 4 of the American Software analysts is that Clear Secure is on the verge of breakeven. They expect the company to post a final loss in 2023, before turning a profit of US$10m in 2024. Therefore, the company is expected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 98% year-on-year, on average, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving Clear Secure's growth isn’t the focus of this broad overview, though, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
Before we wrap up, there’s one aspect worth mentioning. Clear Secure currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
Next Steps:
There are key fundamentals of Clear Secure 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 Clear Secure, take a look at Clear Secure's company page on Simply Wall St. We've also put together a list of relevant aspects you should look at:
Valuation: What is Clear Secure 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 Clear Secure 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 Clear Secure’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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