Fiverr International Ltd.'s (NYSE:FVRR): Fiverr International Ltd. operates an online marketplace worldwide. The US$3.8b market-cap company’s loss lessens since it announced a US$34.2m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$22.2m, as it approaches breakeven. The most pressing concern for investors is FVRR’s path to profitability – when will it breakeven? I’ve put together a brief outline of industry analyst expectations for FVRR, its year of breakeven and its implied growth rate.
According to the 6 industry analysts covering FVRR, the consensus is breakeven is near. They expect the company to post a final loss in 2020, before turning a profit of US$2.8m in 2021. Therefore, FVRR is expected to breakeven roughly a couple of months from now! In order to meet this breakeven date, I calculated the rate at which FVRR must grow year-on-year. It turns out an average annual growth rate of 106% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, FVRR may become profitable much later than analysts predict.
I’m not going to go through company-specific developments for FVRR given that this is a high-level summary, however, take into account that generally 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 FVRR has managed its capital judiciously, with debt making up 0.2% of equity. This means that FVRR has predominantly funded its operations from equity capital,and its low debt obligation reduces the risk around investing in the loss-making company.
There are too many aspects of FVRR to cover in one brief article, but the key fundamentals for the company can all be found in one place – FVRR’s company page on Simply Wall St. I’ve also put together a list of pertinent aspects you should further research:
- Valuation: What is FVRR 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 FVRR 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 Fiverr International’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.
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.
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