We feel now is a pretty good time to analyse Claranova SE's (EPA:ALCLA) business as it appears the company may be on the cusp of a considerable accomplishment. Claranova SE, a technology company, engages in personalized e-commerce, software publishing, and Internet of Things (IoT) management in France, the United States, the United Kingdom, Germany, other European countries, and internationally. With the latest financial year loss of €28m and a trailing-twelve-month loss of €20m, the €29m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Claranova will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Consensus from 2 of the French Software analysts is that Claranova is on the verge of breakeven. They anticipate the company to incur a final loss in 2026, before generating positive profits of €8.7m in 2027. So, the company is predicted to breakeven just over a year from now. 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 84%, 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 Claranova's growth isn’t the focus of this broad overview, however, 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.
View our latest analysis for Claranova
Before we wrap up, there’s one issue worth mentioning. Claranova currently has a debt-to-equity ratio of 123%. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on Claranova, so if you are interested in understanding the company at a deeper level, take a look at Claranova's company page on Simply Wall St. We've also put together a list of essential factors you should look at:
- Valuation: What is Claranova 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 Claranova 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 Claranova’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.