We feel now is a pretty good time to analyse BRC Inc.'s (NYSE:BRCC) business as it appears the company may be on the cusp of a considerable accomplishment. BRC Inc., through its subsidiaries, purchases, roasts, and sells coffee, coffee accessories, and branded apparel in the United States. On 31 December 2023, the US$885m market-cap company posted a loss of US$17m for its most recent financial year. As path to profitability is the topic on BRC's 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.

See our latest analysis for BRC

Consensus from 8 of the American Food analysts is that BRC is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of US$5.9m 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 is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving BRC's growth isn’t the focus of this broad overview, though, take into account that typically 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. BRC currently has a debt-to-equity ratio of 153%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

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

1. Valuation: What is BRC 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 BRC 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 BRC’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.