VTEX (NYSE:VTEX) Is About To Turn The Corner

We feel now is a pretty good time to analyse VTEX's (NYSE:VTEX) business as it appears the company may be on the cusp of a considerable accomplishment. VTEX provides software-as-a-service digital commerce platform for enterprise brands and retailers. On 31 December 2023, the US$1.5b market-cap company posted a loss of US$14m for its most recent financial year. The most pressing concern for investors is VTEX's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for VTEX

VTEX is bordering on breakeven, according to the 7 American Interactive Media and Services analysts. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$6.8m in 2024. So, the company is predicted to breakeven approximately 12 months 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 86% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth

We're not going to go through company-specific developments for VTEX given that this is a high-level summary, however, bear 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’d like to point out is that VTEX 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.

Next Steps:

There are key fundamentals of VTEX 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 VTEX, take a look at VTEX's company page on Simply Wall St. We've also compiled a list of important aspects you should further examine:

1. Valuation: What is VTEX 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 VTEX 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 VTEX’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.

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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.