Analysts Expect Breakeven For Ra Medical Systems, Inc. (NYSE:RMED)
Ra Medical Systems, Inc.’s (NYSE:RMED): Ra Medical Systems, Inc., a commercial-stage medical device company, develops, manufactures, and markets excimer lasers for use in the treatment of vascular and dermatological diseases. The company’s loss has recently broadened since it announced a -US$17.8m loss in the full financial year, compared to the latest trailing-twelve-month loss of -US$19.0m, moving it further away from breakeven. Many investors are wondering the rate at which RMED will turn a profit, with the big question being “when will the company breakeven?” Below I will provide a high-level summary of the industry analysts’ expectations for RMED.
See our latest analysis for Ra Medical Systems
RMED is bordering on breakeven, according to the 4 Medical Equipment analysts. They anticipate the company to incur a final loss in 2019, before generating positive profits of US$2.4m in 2020. RMED is therefore projected to breakeven around 2 years from today. How fast will RMED have to grow each year in order to reach the breakeven point by 2020? Working backwards from analyst estimates, it turns out that they expect the company to grow 86% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, RMED may become profitable much later than analysts predict.
I’m not going to go through company-specific developments for RMED given that this is a high-level summary, but, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing I’d like to point out is that RMED has managed its capital judiciously, with debt making up 0.5% of equity. This means that RMED 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 RMED which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at RMED, take a look at RMED’s company page on Simply Wall St. I’ve also compiled a list of relevant factors you should further examine:
Historical Track Record: What has RMED’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.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Ra Medical Systems’s board and the CEO’s back ground.
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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
