Alpha HPA Limited (ASX:A4N) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Alpha HPA Limited engages in the evaluation, exploration, and development of mineral properties. With the latest financial year loss of AU$7.4m and a trailing-twelve-month loss of AU$4.6m, the AU$755m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Alpha HPA's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for Alpha HPA

According to some industry analysts covering Alpha HPA, breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of AU$9.0m in 2024. So, the company is predicted to breakeven just over a year from today. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 141% 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.

We're not going to go through company-specific developments for Alpha HPA given that this is a high-level summary, though, keep in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that Alpha HPA has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high 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 Alpha HPA, so if you are interested in understanding the company at a deeper level, take a look at Alpha HPA's company page on Simply Wall St. We've also compiled a list of key aspects you should further research:

1. Valuation: What is Alpha HPA 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 Alpha HPA 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 Alpha HPA’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.

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