Verint Systems Inc. (NASDAQ:VRNT) On The Verge Of Breaking Even
We feel now is a pretty good time to analyse Verint Systems Inc.'s (NASDAQ:VRNT) business as it appears the company may be on the cusp of a considerable accomplishment. Verint Systems Inc. provides customer engagement solutions worldwide. The US$2.4b market-cap company announced a latest loss of US$5.9m on 31 January 2023 for its most recent financial year result. As path to profitability is the topic on Verint Systems' investors mind, we've decided to gauge market sentiment. 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 Verint Systems
According to the 7 industry analysts covering Verint Systems, the consensus is that breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of US$69m in 2024. The company is therefore projected to breakeven around 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 82% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Underlying developments driving Verint Systems' growth isn’t the focus of this broad overview, though, keep in mind that generally 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 judiciously, with debt making up 32% 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:
This article is not intended to be a comprehensive analysis on Verint Systems, so if you are interested in understanding the company at a deeper level, take a look at Verint Systems' company page on Simply Wall St. We've also put together a list of important factors you should further research:
Valuation: What is Verint Systems 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 Verint Systems 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 Verint Systems’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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