Flexion Mobile Plc (STO:FLEXM) on the verge of breaking even

We think it’s a good time to analyze Flexion Mobile Plc (STO: FLEXM) As it seems, the company may be on the verge of a huge achievement. Flexion Mobile Plc operates a platform for the distribution of free third-party games in the Android market worldwide. With the last loss of UK£142,000 in the financial year and a loss of UK£278,000 in the last twelve months, the 843 million kr market capitalization company has magnified its loss by moving further away from its break-even target. Many investors wonder about the rate at which Flexion Mobile will make a profit, with the big question being “when will the company break even?” We’ve put together a brief overview of industry analysts’ expectations for the company, its breakeven year and its implied growth rate.

Check out our latest analysis for Flexion Mobile

The consensus of 2 of Sweden’s entertainment analysts is that Flexion Mobile is close to breaking even. They expect the company to post a terminal loss in 2021, before posting a profit of £2.0 million in 2022. Thus, the company should break even in around 12 months or less. How fast will the business need to grow to achieve the consensus estimates predicting breakeven in less than 12 months? Using a line of best fit, we calculated an average annual growth rate of 129%, which is extremely dynamic. If this rate turns out to be too aggressive, the company could become profitable much later than analysts predict.

OM: FLEXM Earnings per share growth February 8, 2022

Developments underlying the growth of Flexion Mobile are not the focus of this general overview, but consider that in general a high growth rate is not unusual, especially when a business is in investment period.

One thing we would like to point out is that Flexion Mobile has no debt on its balance sheet, which is quite unusual for a growing, cash-burning company, which typically has a high level of debt relative to its equity. The company currently operates solely on shareholder funding and has no debt, reducing concerns about repayments and making it a less risky investment.

Next steps:

There are too many aspects of Flexion Mobile to cover in a brief article, but the fundamentals of the business can all be found in one place – Flexion Mobile’s company page on Simply Wall St. We have also compiled a list of essential aspects you need to look at:

  1. Evaluation: What is Flexion Mobile worth today? Has future growth potential already been factored into the price? The intrinsic value infographic in our free research report visualizes whether Flexion Mobile is currently being mispriced by the market.
  2. Management team: An experienced management team at the helm boosts our confidence in the business – take a look at who sits on Flexion Mobile’s board and the CEO’s background.
  3. Other High Performing Stocks: Are there other stocks that offer better prospects with a proven track record? Explore our free list of these great stocks here.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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