Rumble Resources Limited (ASX:RTR) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Rumble Resources Limited engages in the acquisition, exploration, and evaluation of base and precious metal projects in Australia. The AU$56m market-cap company posted a loss in its most recent financial year of AU$12m and a latest trailing-twelve-month loss of AU$10m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Rumble Resources 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.
Rumble Resources is bordering on breakeven, according to some Australian Metals and Mining analysts. They anticipate the company to incur a final loss in 2026, before generating positive profits of AU$7.0m in 2027. 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 140% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Underlying developments driving Rumble Resources' growth isn’t the focus of this broad overview, but, keep in mind 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 that a high growth rate is not unusual, especially if the company is currently in an investment period.
View our latest analysis for Rumble Resources
One thing we’d like to point out is that Rumble Resources has no debt on its balance sheet, which is rare for a loss-making metals and mining company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
Next Steps:
This article is not intended to be a comprehensive analysis on Rumble Resources, so if you are interested in understanding the company at a deeper level, take a look at Rumble Resources' company page on Simply Wall St. We've also put together a list of important aspects you should further examine:
- Valuation: What is Rumble 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 Rumble 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 Rumble 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.
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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.