Eve Health Group Limited (ASX:EVE) Is Expected To Breakeven In The Near Future
With the business potentially at an important milestone, we thought we'd take a closer look at Eve Health Group Limited's (ASX:EVE) future prospects. Eve Health Group Limited, together with its subsidiaries, engages in the production and marketing of nutrition, health, and wellness products in Australia, North America, China, and Asia. The AU$15m market-cap company announced a latest loss of AU$3.6m on 30 June 2021 for its most recent financial year result. The most pressing concern for investors is Eve Health Group'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.
Check out our latest analysis for Eve Health Group
According to some industry analysts covering Eve Health Group, breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of AU$400k in 2024. 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 80% 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 Eve Health Group's upcoming projects, however, take into account that typically 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 The company has managed its capital prudently, with debt making up 5.5% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of Eve Health Group 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 Eve Health Group, take a look at Eve Health Group's company page on Simply Wall St. We've also compiled a list of key aspects you should further research:
Historical Track Record: What has Eve Health Group'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 Eve Health 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.
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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.
