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Titomic Limited's (ASX:TTT) Path To Profitability

We feel now is a pretty good time to analyse Titomic Limited's (ASX:TTT) business as it appears the company may be on the cusp of a considerable accomplishment. Titomic Limited engages in additive manufacturing activities in Australia. With the latest financial year loss of AU$11m and a trailing-twelve-month loss of AU$13m, the AU$84m market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on Titomic's investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.

View our latest analysis for Titomic

Expectations from some of the Australian Chemicals analysts is that Titomic is on the verge of breakeven. They anticipate the company to incur a final loss in 2022, before generating positive profits of AU$10m in 2023. The company is therefore projected to breakeven around 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 88%, 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

Given this is a high-level overview, we won’t go into details of Titomic's upcoming projects, though, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

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One thing we’d like to point out is that Titomic has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

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

  1. Valuation: What is Titomic 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 Titomic is currently mispriced by the market.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Titomic’s 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. 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.