Yahoo Finance Research Solutions, Inc. (NASDAQ:RSSS): When Will It Breakeven?
We feel now is a pretty good time to analyse Research Solutions, Inc.'s (NASDAQ:RSSS) business as it appears the company may be on the cusp of a considerable accomplishment. Research Solutions, Inc., through its subsidiaries, provides cloud-based software-as-a-service research platform. The US$56m market-cap company announced a latest loss of US$1.6m on 30 June 2022 for its most recent financial year result. As path to profitability is the topic on Research Solutions' investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
Check out our latest analysis for Research Solutions
According to the 2 industry analysts covering Research Solutions, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$1.3m in 2024. Therefore, the company is expected to breakeven roughly 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 102% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Given this is a high-level overview, we won’t go into details of Research Solutions' upcoming projects, but, keep in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we’d like to point out is that Research Solutions has no debt on its balance sheet, which is rare for a loss-making 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.
Next Steps:
There are too many aspects of Research Solutions to cover in one brief article, but the key fundamentals for the company can all be found in one place – Research Solutions' company page on Simply Wall St. We've also compiled a list of key factors you should look at:
Historical Track Record: What has Research Solutions' 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 Research Solutions' 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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