AudioEye, Inc. (NASDAQ:AEYE) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. AudioEye, Inc. provides patented, internet content publication, distribution software, and related services to Internet and other media to people regardless of their device, location, or disabilities in the United States. The US$288m market-cap company’s loss lessened since it announced a US$5.9m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$3.5m, as it approaches breakeven. Many investors are wondering about the rate at which AudioEye 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.

See our latest analysis for AudioEye

According to the 4 industry analysts covering AudioEye, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of US$922k in 2025. Therefore, the company is expected to breakeven just over a year from today. 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 116% is expected, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving AudioEye's growth isn’t the focus of this broad overview, though, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with AudioEye is its debt-to-equity ratio of 139%. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

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

1. Valuation: What is AudioEye 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 AudioEye 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 AudioEye’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.