Remitly Global, Inc.'s (NASDAQ:RELY) Profit Outlook

We feel now is a pretty good time to analyse Remitly Global, Inc.'s (NASDAQ:RELY) business as it appears the company may be on the cusp of a considerable accomplishment. Remitly Global, Inc. provides digital financial services for immigrants, their families, and other citizens in the United States, Canada, and internationally. With the latest financial year loss of US$118m and a trailing-twelve-month loss of US$111m, the US$2.3b market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Remitly Global 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 Remitly Global

According to the 9 industry analysts covering Remitly Global, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$64m in 2026. Therefore, the company is expected to breakeven roughly 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 77% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth

Given this is a high-level overview, we won’t go into details of Remitly Global's upcoming projects, but, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 28% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Remitly Global, so if you are interested in understanding the company at a deeper level, take a look at Remitly Global's company page on Simply Wall St. We've also compiled a list of key factors you should look at:

1. Historical Track Record: What has Remitly Global'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 Remitly Global'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.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com