In This Article:
Polymetals Resources Ltd (ASX:POL) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Polymetals Resources Ltd engages in the exploration and development of gold projects in West Africa. On 30 June 2024, the AU$166m market-cap company posted a loss of AU$3.3m for its most recent financial year. Many investors are wondering about the rate at which Polymetals 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.
View our latest analysis for Polymetals Resources
Expectations from some of the Australian Metals and Mining analysts is that Polymetals Resources is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of AU$13m in 2026. So, the company is predicted to breakeven approximately 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 58% is expected, which is extremely buoyant. 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 Polymetals Resources' upcoming projects, however, take into account that generally a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 9.3% 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:
There are too many aspects of Polymetals Resources to cover in one brief article, but the key fundamentals for the company can all be found in one place – Polymetals Resources' company page on Simply Wall St. We've also compiled a list of key factors you should further research:
-
Valuation: What is Polymetals 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 Polymetals Resources is currently mispriced by the market.
-
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Polymetals Resources’s 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.