We feel now is a pretty good time to analyse Tietto Minerals Limited's (ASX:TIE) business as it appears the company may be on the cusp of a considerable accomplishment. Tietto Minerals Limited operates as a gold exploration and development company in Australia and West Africa. On 30 June 2021, the AU$400m market-cap company posted a loss of AU$20m for its most recent financial year. Many investors are wondering about the rate at which Tietto Minerals 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 Tietto Minerals

Tietto Minerals is bordering on breakeven, according to some Australian Metals and Mining analysts. They expect the company to post a final loss in 2022, before turning a profit of AU$74m in 2023. Therefore, the company is expected to breakeven just over a year from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 100%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected. earnings-per-share-growth

Underlying developments driving Tietto Minerals' growth isn’t the focus of this broad overview, but, keep in mind that generally a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. So, 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 Tietto Minerals has no debt on its balance sheet, which is rare for a loss-making metals and mining company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.



Next Steps:

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

Valuation: What is Tietto Minerals 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 Tietto Minerals is currently mispriced by the market. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Tietto Minerals’s board and the CEO’s background. 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.