With the business potentially at an important milestone, we thought we'd take a closer look at Enthusiast Gaming Holdings Inc.'s (TSE:EGLX) future prospects. Enthusiast Gaming Holdings Inc., an integrated gaming entertainment company, engages in the media, content, entertainment and esports, and subscription businesses in the United States, Canada, England and Wales, and internationally. The CA$23m market-cap company’s loss lessened since it announced a CA$118m loss in the full financial year, compared to the latest trailing-twelve-month loss of CA$104m, as it approaches breakeven. As path to profitability is the topic on Enthusiast Gaming Holdings' investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Enthusiast Gaming Holdings

Consensus from 7 of the Canadian Interactive Media and Services analysts is that Enthusiast Gaming Holdings is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of CA$1.9m in 2025. So, the company is predicted 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 140% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Enthusiast Gaming Holdings' growth isn’t the focus of this broad overview, though, bear in mind that generally 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 16% 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 Enthusiast Gaming Holdings, so if you are interested in understanding the company at a deeper level, take a look at Enthusiast Gaming Holdings' company page on Simply Wall St. We've also put together a list of relevant aspects you should look at:

1. Valuation: What is Enthusiast Gaming 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 Enthusiast Gaming 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 Enthusiast Gaming 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.

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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.