Analysts Are Optimistic We'll See A Profit From Procaps Group S.A. (NASDAQ:PROC)
We feel now is a pretty good time to analyse Procaps Group S.A.'s (NASDAQ:PROC) business as it appears the company may be on the cusp of a considerable accomplishment. Procaps Group S.A. develops, produces, and markets pharmaceutical solutions worldwide. With the latest financial year loss of US$101m and a trailing-twelve-month loss of US$67m, the US$970m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Procaps Group's investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.
See our latest analysis for Procaps Group
Procaps Group is bordering on breakeven, according to the 2 American Pharmaceuticals analysts. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$46m in 2022. The company is therefore projected to breakeven around a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 119% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Given this is a high-level overview, we won’t go into details of Procaps Group's upcoming projects, however, keep in mind that typically a pharma company has lumpy cash flows which are contingent on the drug and stage of product development the business is in. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing we would like to bring into light with Procaps Group is it currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. These losses tend to occur only on paper, however, in other cases it can be forewarning.
There are too many aspects of Procaps Group to cover in one brief article, but the key fundamentals for the company can all be found in one place – Procaps Group's company page on Simply Wall St. We've also put together a list of pertinent factors you should further research:
Valuation: What is Procaps Group 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 Procaps Group 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 Procaps Group’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.