MoneyGram International Inc’s (NASDAQ:MGI): MoneyGram International, Inc., together with its subsidiaries, provides money transfer services in the United States and internationally. The US$507.80M market-cap company announced a latest loss of -US$29.80M on 31 December 2017 for its most recent financial year result. The most pressing concern for investors is MGI’s path to profitability – when will it breakeven? In this article, I will touch on the expectations for MGI’s growth and when analysts expect the company to become profitable.

See our latest analysis for MoneyGram International

Expectation from analysts is MGI is on the verge of breakeven. They anticipate the company to incur a final loss in 2017, before generating positive profits of US$47.01M in 2018. Therefore, MGI is expected to breakeven roughly a few months from now. What rate will MGI have to grow year-on-year in order to breakeven on this date? Using a line of best fit, I calculated an average annual growth rate of 105.98%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving MGI’s growth isn’t the focus of this broad overview, but, keep in mind that by and large 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 issue worth mentioning. MGI currently has negative equity on its balance sheet. This can sometimes arise from accounting methods used to deal with accumulated losses from prior years, which are viewed as liabilities carried forward until it cancels out in the future. Oftentimes, losses exist only on paper but other times, it can be a red flag.

Next Steps:

There are key fundamentals of MGI which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at MGI, take a look at MGI’s company page on Simply Wall St. I’ve also compiled a list of pertinent aspects you should further research:

1. Valuation: What is MGI 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 MGI 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 MoneyGram International’s board and the CEO’s back ground.

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.

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.