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When Will Dubber Corporation Limited (ASX:DUB) Become Profitable?

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Simply Wall St
·3 min read
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We feel now is a pretty good time to analyse Dubber Corporation Limited's (ASX:DUB) business as it appears the company may be on the cusp of a considerable accomplishment. Dubber Corporation Limited operates a unified call recording platform in North America, Europe, and the Asia-Pacific. The AU$388m market-cap company announced a latest loss of AU$18m on 30 June 2020 for its most recent financial year result. The most pressing concern for investors is Dubber's path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for Dubber

According to some industry analysts covering Dubber, breakeven is near. They anticipate the company to incur a final loss in 2022, before generating positive profits of AU$3.1m in 2023. 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 66% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth
earnings-per-share-growth

Underlying developments driving Dubber's growth isn’t the focus of this broad overview, but, take into account that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. Dubber 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. 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 key fundamentals of Dubber 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 Dubber, take a look at Dubber's company page on Simply Wall St. We've also compiled a list of pertinent factors you should further research:

  1. Historical Track Record: What has Dubber'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.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Dubber'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.

This article by Simply Wall St is general in nature. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.