Thinkific Labs Inc. ( TSX:THNC ) has the potential to “sustain a 70% plus revenue compound annual growth rate over the next three years,” says one analyst at Capital Ideas Media on July 9, 2021.
COVID-19 lockdowns have added fuel to an online learning industry that was already growing like wildfire. In fact, Global Market Insights estimates the e-learning market will expand at a compound annual growth rate (CAGR) of more than 21%, exceeding US$1 trillion by 2027.
This is a big reason why some analysts are so upbeat on newly-listed Canadian company Thinkific Labs Inc. (TSX:THNC).
Thinkific provides software solutions that help entrepreneurs and larger businesses create, market, and sell online courses. The Company, meanwhile, has already tasted success by attracting 24,600 paying customers at the end of 2020, a 126% year-over-year increase.
During its most-recently reported quarter (Q1 2021), Thinkific saw its revenue surge 152% to US$8.3 million.
And, with total gross proceeds of C$184 million raised during its late April Initial Public Offering (IPO), CIBC World Markets analyst Todd Coupland believes the Company “is investing to drive further growth to scale its business,” which he expects will lead to revenue growth of 67% annually over the next three years.
“Its durable business model and highly efficient go-to-market generate predictable and recurring revenue, raising confidence in our conservative forecast,” Mr. Coupland noted.
With this investment in growth, however, Thinkific recorded a first-quarter net loss of US$1.0 million after losing US$1.29 million during Fiscal 2020.
Yet, the CIBC World Markets analyst thinks education and the rise of the creator economy are powerful secular trends that “support a multi-year outlook of high-double-digit growth for Thinkific.”
Taking it one step further, BMO Nesbitt Burns analyst Thanos Moschopoulos called Thinkific, essentially, “a Shopify for creating and selling courses online.”