When Will Tobii AB (publ) (STO:TOBII) Breakeven?
Tobii AB (publ)'s (STO:TOBII): Tobii AB (publ) develops and sells eye-tracking technology and solutions worldwide. The kr4.6b market-cap company announced a latest loss of -kr159.5m on 31 December 2019 for its most recent financial year result. Many investors are wondering the rate at which TOBII will turn a profit, with the big question being “when will the company breakeven?” I’ve put together a brief outline of industry analyst expectations for TOBII, its year of breakeven and its implied growth rate.
See our latest analysis for Tobii
Expectation from Tech analysts is TOBII is on the verge of breakeven. They anticipate the company to incur a final loss in 2021, before generating positive profits of kr43m in 2022. So, TOBII is predicted to breakeven approximately 2 years from now. How fast will TOBII have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 84% 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 TOBII’s growth isn’t the focus of this broad overview, however, bear in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing I would like to bring into light with TOBII is its relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in TOBII’s case is 43%. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.
Next Steps:
There are too many aspects of TOBII to cover in one brief article, but the key fundamentals for the company can all be found in one place – TOBII’s company page on Simply Wall St. I’ve also put together a list of pertinent factors you should further research:
Historical Track Record: What has TOBII'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 Tobii’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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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