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From https://**.st/stocks/au/software/asx-sbw/shekel-brainweigh-shares/news/shekel-brainweigh-ltd-asxsbw-is-breakeven-near

Shekel Brainweigh Ltd. (ASX:SBW) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Shekel Brainweigh Ltd., together with its subsidiaries, operates as a digital weighing technology company worldwide. The company’s loss has recently broadened since it announced a US$4.5m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$4.7m, moving it further away from breakeven. The most pressing concern for investors is Shekel Brainweigh's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Shekel Brainweigh

Expectations from some of the Australian Software analysts is that Shekel Brainweigh is on the verge of breakeven. They expect the company to post a final loss in 2021, before turning a profit of US$500k in 2022. The company is therefore projected 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 103% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

ASX:SBW Earnings Per Share Growth October 27th 2021

Given this is a high-level overview, we won’t go into details of Shekel Brainweigh's upcoming projects, however, take into account that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one issue worth mentioning. Shekel Brainweigh currently has a debt-to-equity ratio of over 2x. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.