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Analysts Expect Breakeven For Bio-Gene Technology Limited (ASX:BGT) Before Long

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Simply Wall St
·3 min read
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We feel now is a pretty good time to analyse Bio-Gene Technology Limited's (ASX:BGT) business as it appears the company may be on the cusp of a considerable accomplishment. Bio-Gene Technology Limited, a biotechnology company, engages in developing insecticides/pesticides for animal health, crop protection, public health, and consumer applications in Australia. The AU$21m market-cap company posted a loss in its most recent financial year of AU$1.9m and a latest trailing-twelve-month loss of AU$2.2m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is Bio-Gene Technology's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Bio-Gene Technology

Bio-Gene Technology is bordering on breakeven, according to some Australian Chemicals analysts. They expect the company to post a final loss in 2023, before turning a profit of AU$1.5m in 2024. Therefore, the company is expected to breakeven roughly 3 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 78% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
earnings-per-share-growth

We're not going to go through company-specific developments for Bio-Gene Technology given that this is a high-level summary, however, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up -0.1% 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.

Next Steps:

There are key fundamentals of Bio-Gene Technology 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 Bio-Gene Technology, take a look at Bio-Gene Technology's company page on Simply Wall St. We've also compiled a list of pertinent aspects you should further research:

  1. Historical Track Record: What has Bio-Gene Technology's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Bio-Gene Technology'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.

This article by Simply Wall St is general in nature. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.