Yahoo Finance Basic-Fit N.V. (AMS:BFIT) Is About To Turn The Corner
With the business potentially at an important milestone, we thought we'd take a closer look at Basic-Fit N.V.'s (AMS:BFIT) future prospects. Basic-Fit N.V., together with its subsidiaries, engages in the operation of fitness clubs. On 31 December 2022, the €2.3b market-cap company posted a loss of €3.7m for its most recent financial year. Many investors are wondering about the rate at which Basic-Fit will turn a profit, with the big question being “when will the company 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 Basic-Fit
Basic-Fit is bordering on breakeven, according to the 6 Dutch Hospitality analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of €41m in 2023. So, the company is predicted to breakeven approximately a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 60% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving Basic-Fit's growth isn’t the focus of this broad overview, however, keep in mind 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 Basic-Fit is its debt-to-equity ratio of 182%. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on Basic-Fit, so if you are interested in understanding the company at a deeper level, take a look at Basic-Fit's company page on Simply Wall St. We've also put together a list of pertinent factors you should further examine:
Historical Track Record: What has Basic-Fit's 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.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Basic-Fit'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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