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With the business potentially at an important milestone, we thought we'd take a closer look at Gaia, Inc.'s (NASDAQ:GAIA) future prospects. Gaia, Inc. operates a digital video subscription service and online community for underserved member base in the United States, Canada, Australia, and internationally. The US$101m market-cap company announced a latest loss of US$5.2m on 31 December 2024 for its most recent financial year result. As path to profitability is the topic on Gaia's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
See our latest analysis for Gaia
Consensus from 4 of the American Entertainment analysts is that Gaia is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$5.2m in 2026. So, the company is predicted to breakeven just over a year from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 104%, which is rather optimistic! 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 Gaia's upcoming projects, but, take into account that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 6.2% 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 Gaia to cover in one brief article, but the key fundamentals for the company can all be found in one place – Gaia's company page on Simply Wall St. We've also compiled a list of key factors you should further examine:
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Valuation: What is Gaia 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 Gaia 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 Gaia’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.
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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.