With the business potentially at an important milestone, we thought we'd take a closer look at Warby Parker Inc.'s (NYSE:WRBY) future prospects. Warby Parker Inc. provides eyewear products in the United States and Canada. The US$2.1b market-cap company’s loss lessened since it announced a US$63m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$46m, as it approaches breakeven. As path to profitability is the topic on Warby Parker'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.

Check out our latest analysis for Warby Parker

Warby Parker is bordering on breakeven, according to the 14 American Specialty Retail analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$15m in 2025. Therefore, the company is expected to breakeven just over a year 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 116% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for Warby Parker given that this is a high-level summary, however, take into account that generally 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. Warby Parker currently has no debt on its balance sheet, which is rare for a loss-making growth company, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Warby Parker, so if you are interested in understanding the company at a deeper level, take a look at Warby Parker's company page on Simply Wall St. We've also compiled a list of pertinent aspects you should further examine:

1. Valuation: What is Warby Parker 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 Warby Parker 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 Warby Parker’s board and the CEO’s background.

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.

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.