When can we expect a profit from D2L Inc. (TSE: DTOL)?

D2L Inc. (TSE: DTOL) may be approaching a major achievement in his company, so we’d like to shed some light on the company. D2L Corporation provides an integrated online learning platform for learners in the higher education, K-12, healthcare, government, and corporate sectors. With the last loss of $98 million in the fiscal year and a loss of $55 million in the last twelve months, the $294 million market capitalization company has mitigated its loss by approaching its target of ‘balance. Many investors wonder about the rate at which D2L 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.

See our latest analysis for D2L

D2L is close to equilibrium, according to the 7 analysts of Canadian Consumer Services. They expect the business to make a terminal loss in 2024, before making a profit of US$7.2 million in 2025. Thus, the business is expected to break even in about 3 years from of today. How fast will the business need to grow year over year to break even by that date? Using a line of best fit, we calculated an average annual growth rate of 86%, which is quite optimistic! If this rate turns out to be too aggressive, the company could become profitable much later than analysts predict.

earnings per share growth

We are not going to review company-specific developments for D2L since this is a high-level summary, however, please consider that a high projected growth rate is not generally not unusual for a company currently going through an investment period.

Before concluding, there is one aspect worth mentioning. D2L currently has no debt on its balance sheet, which is quite unusual for a cash-intensive growth 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:

This article is not intended to be a full analysis of D2L, so if you want to understand the company on a deeper level, check out D2L’s company page on Simply Wall St. We’ve also put together a list of essential factors. you should watch:

  1. Evaluation: What is D2L worth today? Has future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether D2L is currently being mispriced by the market.

  2. Management team: An experienced management team at the helm boosts our confidence in the company – look at who sits on D2L’s board and the CEO’s journey.

  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.

Feedback on this article? Concerned about content? Get in touch with us directly. You can also email the editorial team (at) Simplywallst.com.

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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