Bellevue Gold Limited (ASX:BGL) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Bellevue Gold Limited, together with its subsidiaries, engages in the exploration and evaluation of gold properties in Australia. With the latest financial year loss of AU$25m and a trailing-twelve-month loss of AU$10m, the AU$2.3b market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Bellevue Gold’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.
See our latest analysis for Bellevue Gold
According to the 6 industry analysts covering Bellevue Gold, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of AU$254m in 2025. Therefore, the company is expected to breakeven just over a year from today. 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 34%, 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 Bellevue Gold’s growth isn’t the focus of this broad overview, though, take into account that by and large metals and mining companies, depending on the stage of operation and metals mined, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
One thing we would like to bring into light with Bellevue Gold is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Bellevue Gold’s case is 50%. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of Bellevue Gold 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 Bellevue Gold, take a look at Bellevue Gold’s company page on Simply Wall St. We’ve also compiled a list of pertinent aspects you should further research:
-
Valuation: What is Bellevue Gold 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 Bellevue Gold 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 Bellevue Gold’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.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
Credit: Source link