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Moovly Media Inc.'s (CVE:MVY) Shift From Loss To Profit

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We feel now is a pretty good time to analyse Moovly Media Inc.'s (CVE:MVY) business as it appears the company may be on the cusp of a considerable accomplishment. Moovly Media Inc. develops cloud-based digital media and content creation platform in Canada and Belgium. The company’s loss has recently broadened since it announced a CA$1.7m loss in the full financial year, compared to the latest trailing-twelve-month loss of CA$2.6m, moving it further away from breakeven. Many investors are wondering about the rate at which Moovly Media 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.

Check out our latest analysis for Moovly Media

Moovly Media is bordering on breakeven, according to some Canadian Interactive Media and Services analysts. They expect the company to post a final loss in 2021, before turning a profit of CA$4.5m in 2022. So, the company is predicted to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 189% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth
earnings-per-share-growth

Given this is a high-level overview, we won’t go into details of Moovly Media's upcoming projects, though, bear in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one issue worth mentioning. Moovly Media currently has negative equity on its balance sheet. This can sometimes arise from accounting methods used to deal with accumulated losses from prior years, which are viewed as liabilities carried forward until it cancels out in the future. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

There are too many aspects of Moovly Media to cover in one brief article, but the key fundamentals for the company can all be found in one place – Moovly Media's company page on Simply Wall St. We've also put together a list of important factors you should further research:

  1. Valuation: What is Moovly Media 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 Moovly Media is currently mispriced by the market.

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

This article by Simply Wall St is general in nature. 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 (at) simplywallst.com.

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