1-3 Year Outlook for Smart Employee Benefits

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SEB.V was recommended to me by a ‘friend’ as a company with very strong growth prospects. I’ve held it for over a year now and it has struggled to go anywhere. Would like your analysis on them and what the future may hold for them. Thanks.

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Asked on January 13, 2021 6:01 am
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Hey there. I'd be very curious to see where your friend thinks the growth is going to come from. Revenue and earnings have been dipping pretty steadily over the last four years. Company has gone from $97 million in revenue in 2016 to only $68 million in 2019. Looks like revenue could actually come in lower than this mark in 2020 as well.

The company also has a very poor balance sheet, with almost 3X the current liabilities as current assets. In the simplest terms possible, this essentially means it has around 1/3 of the cash to satisfy it's obligations over the next year. This will likely mean the issuance of shares, or debt. None of which are good for shareholders.

Unless there is some sort of significant shift in the company's business, I just don't see how this company goes from a perennial underperformer to a growth company.

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Posted by Dan Kent
Answered on January 13, 2021 10:05 am