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Directa Plus Plc (LON:DCTA) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Directa Plus Plc manufactures and sells graphene-based products for industrial and commercial applications in Italy and internationally. On 31 December 2022, the UK£48m market-cap company posted a loss of €4.8m for its most recent financial year. The most pressing concern for investors is Directa Plus' path to profitability – when will it breakeven? 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 Directa Plus
According to some industry analysts covering Directa Plus, breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of €3.8m in 2025. The company is therefore projected to breakeven around 2 years from now. 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 85% 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 Directa Plus' upcoming projects, but, 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 The company has managed its capital prudently, with debt making up 20% of equity. This means that it 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 Directa Plus, so if you are interested in understanding the company at a deeper level, take a look at Directa Plus' company page on Simply Wall St. We've also compiled a list of pertinent aspects you should further examine:
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Valuation: What is Directa Plus 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 Directa Plus 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 Directa Plus’s board and the CEO’s background.
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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.