We feel now is a pretty good time to analyse Alithya Group Inc.'s (TSE:ALYA) business as it appears the company may be on the cusp of a considerable accomplishment. Alithya Group Inc. provides strategy and digital technology services in Canada, the United States, and Europe. With the latest financial year loss of CA$17m and a trailing-twelve-month loss of CA$12m, the CA$169m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Alithya Group will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Alithya Group

According to the 6 industry analysts covering Alithya Group, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of CA$13m in 2026. So, the company is predicted to breakeven approximately 2 years 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 110% is expected, which is rather optimistic! 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 Alithya Group given that this is a high-level summary, however, keep in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with Alithya Group is its relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Alithya Group's case is 62%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of Alithya Group to cover in one brief article, but the key fundamentals for the company can all be found in one place – Alithya Group's company page on Simply Wall St. We've also compiled a list of relevant factors you should look at:

1. Valuation: What is Alithya Group 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 Alithya Group 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 Alithya Group’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.