We feel now is a pretty good time to analyse Seeing Machines Limited's (LON:SEE) business as it appears the company may be on the cusp of a considerable accomplishment. Seeing Machines Limited, together with its subsidiaries, provides driver and occupant monitoring system technologies in Australia, North America, the Asia Pacific, Europe, and internationally. With the latest financial year loss of US$17m and a trailing-twelve-month loss of US$13m, the UK£236m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Seeing Machines will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

See our latest analysis for Seeing Machines

Seeing Machines is bordering on breakeven, according to the 5 British Electronic analysts. They expect the company to post a final loss in 2024, before turning a profit of US$4.4m in 2025. So, the company is predicted to breakeven approximately 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 73%, 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. earnings-per-share-growth

We're not going to go through company-specific developments for Seeing Machines given that this is a high-level summary, however, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with Seeing Machines is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Seeing Machines' case is 44%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of Seeing Machines to cover in one brief article, but the key fundamentals for the company can all be found in one place – Seeing Machines' company page on Simply Wall St. We've also put together a list of pertinent factors you should look at:

Valuation: What is Seeing Machines 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 Seeing Machines 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 Seeing Machines’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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