Trupanion, Inc. (NASDAQ:TRUP) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Trupanion, Inc., together with its subsidiaries, provides medical insurance for cats and dogs on a monthly subscription basis in the United States, Canada, Continental Europe, and Australia. The US$2.0b market-cap company’s loss lessened since it announced a US$45m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$13m, as it approaches breakeven. Many investors are wondering about the rate at which Trupanion will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
View our latest analysis for Trupanion
Trupanion is bordering on breakeven, according to the 7 American Insurance analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$1.4m in 2025. The company is therefore projected to breakeven around 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 74% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
We're not going to go through company-specific developments for Trupanion given that this is a high-level summary, however, keep in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we would like to bring into light with Trupanion is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Trupanion's case is 40%. Note that a higher debt obligation increases the risk in investing in the loss-making company.
This article is not intended to be a comprehensive analysis on Trupanion, so if you are interested in understanding the company at a deeper level, take a look at Trupanion's company page on Simply Wall St. We've also compiled a list of essential factors you should further examine:
Discover if Trupanion might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
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