Tyro Payments Limited (ASX:TYR) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Tyro Payments Limited provides payment solutions to merchants in Australia. With the latest financial year loss of AU$30m and a trailing-twelve-month loss of AU$44m, the AU$528m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Tyro Payments 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.
According to the 9 industry analysts covering Tyro Payments, the consensus is that breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of AU$2.1m in 2024. So, the company is predicted to breakeven approximately 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 68% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Given this is a high-level overview, we won’t go into details of Tyro Payments' upcoming projects, 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.
Before we wrap up, there’s one aspect worth mentioning. Tyro Payments currently 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. 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.
This article is not intended to be a comprehensive analysis on Tyro Payments, so if you are interested in understanding the company at a deeper level, take a look at Tyro Payments' company page on Simply Wall St. We've also compiled a list of essential factors you should further examine:
Valuation: What is Tyro Payments 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 Tyro Payments 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 Tyro Payments’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.
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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.