With the business potentially at an important milestone, we thought we'd take a closer look at agilon health, inc.'s (NYSE:AGL) future prospects. agilon health, inc. offers healthcare services for seniors through primary care physicians in the communities of the United States. The US$9.6b market-cap company posted a loss in its most recent financial year of US$405m and a latest trailing-twelve-month loss of US$114m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which agilon health 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.
Consensus from 12 of the American Healthcare analysts is that agilon health is on the verge of breakeven. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$12m in 2023. The company is therefore projected to breakeven just over a year from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 68%, 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.
We're not going to go through company-specific developments for agilon health given that this is a high-level summary, though, keep in mind that generally 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 aspect worth mentioning. The company has managed its capital judiciously, with debt making up 4.2% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
There are key fundamentals of agilon health which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at agilon health, take a look at agilon health's company page on Simply Wall St. We've also put together a list of relevant factors you should look at:
Valuation: What is agilon health 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 agilon health is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on agilon health’s board and the CEO’s background.
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.
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