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MICT, Inc.'s (NASDAQ:MICT) Profit Outlook

With the business potentially at an important milestone, we thought we'd take a closer look at MICT, Inc.'s (NASDAQ:MICT) future prospects. MICT, Inc., through its subsidiaries, designs, develops, manufactures, and sells mobile computing devices and software for fleet operators and field workforces. With the latest financial year loss of US$23m and a trailing-twelve-month loss of US$36m, the US$100m market-cap company amplified its loss by moving further away from its breakeven target. The most pressing concern for investors is MICT's path to profitability – when will it 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 MICT

MICT is bordering on breakeven, according to some American Electronic analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$11m in 2023. So, the company is predicted to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 96% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

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

Underlying developments driving MICT's growth isn’t the focus of this broad overview, however, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that MICT has no debt on its balance sheet, which is rare for a loss-making growth company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

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

  1. Valuation: What is MICT 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 MICT 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 MICT’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.

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.

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