AcuityAds Holdings Inc (CVE:AT): Are Analysts Optimistic?

AcuityAds Holdings Inc’s (CVE:AT): AcuityAds Holdings Inc., together with its subsidiaries, provides digital media solutions. The company’s loss has recently broadened since it announced a -CA$6.56m loss in the full financial year, compared to the latest trailing-twelve-month loss of -CA$8.53m, moving it further away from breakeven. As path to profitability is the topic on AT’s investors mind, I’ve decided to gauge market sentiment. Below I will provide a high-level summary of the industry analysts’ expectations for AT.

View out our latest analysis for AcuityAds Holdings

AT is bordering on breakeven, according to Internet analysts. They expect the company to post a final loss in 2018, before turning a profit of CA$2.90m in 2019. AT is therefore projected to breakeven around a few months from now. How fast will AT have to grow each year in order to reach the breakeven point by 2019? Working backwards from analyst estimates, it turns out that they expect the company to grow 120.81% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, AT may become profitable much later than analysts predict.

TSXV:AT Past Future Earnings June 25th 18

Underlying developments driving AT’s growth isn’t the focus of this broad overview, though, keep in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before I wrap up, there’s one issue worth mentioning. AT currently has a debt-to-equity ratio of 124.60%. Typically, debt shouldn’t exceed 40% of your equity, and AT has considerably exceeded this. 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 too many aspects of AT to cover in one brief article, but the key fundamentals for the company can all be found in one place – AT’s company page on Simply Wall St. I’ve also compiled a list of important factors you should further examine:

1. Historical Track Record: What has AT’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 AcuityAds Holdings’s board and the CEO’s back ground.

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.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.