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Grab Holdings Limited (NASDAQ:GRAB) Has Found A Path To Profitability

Simply Wall St ·  Jan 8 18:56

We feel now is a pretty good time to analyse Grab Holdings Limited's (NASDAQ:GRAB) business as it appears the company may be on the cusp of a considerable accomplishment. Grab Holdings Limited engages in the provision of superapps in Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. The US$20b market-cap company's loss lessened since it announced a US$434m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$96m, as it approaches breakeven. Many investors are wondering about the rate at which Grab Holdings will turn a profit, with the big question being "when will the company breakeven?" Below we will provide a high-level summary of the industry analysts' expectations for the company.

According to the 24 industry analysts covering Grab Holdings, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$170m in 2025. So, the company is predicted to breakeven approximately a year 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 43% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

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NasdaqGS:GRAB Earnings Per Share Growth January 8th 2025

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

Before we wrap up, there's one aspect worth mentioning. The company has managed its capital prudently, with debt making up 5.1% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

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

  1. Valuation: What is Grab Holdings 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 Grab Holdings 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 Grab Holdings'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.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
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