We feel now is a pretty good time to analyse Audeara Limited's (ASX:AUA) business as it appears the company may be on the cusp of a considerable accomplishment. Audeara Limited, a hearing health technology company, develops and sells personalized listening products. The AU$12m market-cap company posted a loss in its most recent financial year of AU$1.3m and a latest trailing-twelve-month loss of AU$2.2m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which Audeara will turn a profit, with the big question being “when will the company 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 Audeara

Expectations from some of the Australian Consumer Durables analysts is that Audeara is on the verge of breakeven. They anticipate the company to incur a final loss in 2023, before generating positive profits of AU$1.6m in 2024. Therefore, the company is expected to breakeven roughly 2 years from today. 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 76% 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.

Underlying developments driving Audeara's growth isn’t the focus of this broad overview, but, keep in mind that typically 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 0.2% 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 key fundamentals of Audeara which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Audeara, take a look at Audeara's company page on Simply Wall St. We've also compiled a list of key factors you should further examine:

1. Historical Track Record: What has Audeara's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.

2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Audeara'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.

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