We feel now is a pretty good time to analyse Talkspace, Inc.'s (NASDAQ:TALK) business as it appears the company may be on the cusp of a considerable accomplishment. Talkspace, Inc. operates as a virtual behavioral healthcare company in the United States. The US$336m market-cap company posted a loss in its most recent financial year of US$19m and a latest trailing-twelve-month loss of US$7.7m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Talkspace 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 Talkspace

According to the 3 industry analysts covering Talkspace, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$8.6m in 2025. Therefore, the company is expected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 61% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Talkspace's growth isn’t the focus of this broad overview, however, keep in mind that typically 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 Talkspace has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Talkspace to cover in one brief article, but the key fundamentals for the company can all be found in one place – Talkspace's company page on Simply Wall St. We've also put together a list of key aspects you should further research:

1. Valuation: What is Talkspace 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 Talkspace 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 Talkspace’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.