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CSE Global Limited’s (SGX:544): CSE Global Limited, an investment holding company, provides integrated industrial automation, information technology, and intelligent transport solutions in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. On 31 December 2017, the S$198.69M market-cap posted a loss of -S$45.15M for its most recent financial year. The most pressing concern for investors is 544’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for 544.
View our latest analysis for CSE Global
544 is bordering on breakeven, according to analysts. They expect the company to post a final loss in 2017, before turning a profit of S$15.00M in 2018. So, 544 is predicted to breakeven approximately a few months from now. In order to meet this breakeven date, I calculated the rate at which 544 must grow year-on-year. It turns out an average annual growth rate of 80.36% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, 544 may become profitable much later than analysts predict.
I’m not going to go through company-specific developments for 544 given that this is a high-level summary, though, 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.
Before I wrap up, there’s one aspect worth mentioning. 544 has managed its capital prudently, with debt making up 17.87% of equity. This means that 544 has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on 544, so if you are interested in understanding the company at a deeper level, take a look at 544’s company page on Simply Wall St. I’ve also put together a list of relevant factors you should further examine:
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Valuation: What is 544 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 544 is currently mispriced by the market.
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Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on CSE Global’s board and the CEO’s back ground.
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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.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.