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Camplify Holdings Limited (ASX:CHL): When Will It Breakeven?

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·3-min read
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With the business potentially at an important milestone, we thought we'd take a closer look at Camplify Holdings Limited's (ASX:CHL) future prospects. Camplify Holdings Limited provides peer-to-peer digital marketplace platforms to connect recreational vehicle (RV) owners and small-medium enterprises with a fleet of RVs to hirers. The AU$127m market-cap company announced a latest loss of AU$2.1m on 30 June 2021 for its most recent financial year result. The most pressing concern for investors is Camplify Holdings' 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.

See our latest analysis for Camplify Holdings

Expectations from some of the Australian Transportation analysts is that Camplify Holdings is on the verge of breakeven. They anticipate the company to incur a final loss in 2023, before generating positive profits of AU$700k in 2024. Therefore, the company is expected to breakeven roughly 3 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 39% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
earnings-per-share-growth

Underlying developments driving Camplify Holdings' growth isn’t the focus of this broad overview, however, keep 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 we’d like to point out is that Camplify Holdings has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Camplify Holdings 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 Camplify Holdings, take a look at Camplify Holdings' company page on Simply Wall St. We've also put together a list of key factors you should further examine:

  1. Historical Track Record: What has Camplify Holdings' 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.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Camplify Holdings' board and the CEO’s background.

  3. 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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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