With the business potentially at an important milestone, we thought we'd take a closer look at Carnaby Resources Limited's (ASX:CNB) future prospects. Carnaby Resources Limited, together with its subsidiaries, engages in the exploration and development of mineral properties in Australia. The AU$65m market-cap company’s loss lessened since it announced a AU$12m loss in the full financial year, compared to the latest trailing-twelve-month loss of AU$8.3m, as it approaches breakeven. Many investors are wondering about the rate at which Carnaby Resources will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

According to the 2 industry analysts covering Carnaby Resources, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2026, before generating positive profits of AU$23m in 2027. Therefore, the company is expected to breakeven roughly 2 years from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 79% is expected, 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 Carnaby Resources' upcoming projects, but, take into account that by and large metals and mining companies, depending on the stage of operation and metals mined, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Check out our latest analysis for Carnaby Resources

One thing we’d like to point out is that Carnaby Resources has no debt on its balance sheet, which is rare for a loss-making metals and mining 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 Carnaby Resources to cover in one brief article, but the key fundamentals for the company can all be found in one place – Carnaby Resources' company page on Simply Wall St. We've also compiled a list of relevant aspects you should further research:

1. Valuation: What is Carnaby Resources 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 Carnaby Resources 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 Carnaby Resources’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.

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.