Antibe Therapeutics Inc.'s (TSE:ATE) Path To Profitability
We feel now is a pretty good time to analyse Antibe Therapeutics Inc.'s (TSE:ATE) business as it appears the company may be on the cusp of a considerable accomplishment. Antibe Therapeutics Inc., a biotechnology company, engages in developing novel therapeutics and medical devices in the areas of pain, inflammation and regenerative medicine in Canada, Europe, the United States, and internationally. On 31 March 2023, the CA$25m market-cap company posted a loss of CA$19m for its most recent financial year. The most pressing concern for investors is Antibe Therapeutics' path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
View our latest analysis for Antibe Therapeutics
Consensus from 4 of the Canadian Pharmaceuticals analysts is that Antibe Therapeutics is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of CA$1.1m in 2026. The company is therefore projected to breakeven around 3 years from now. 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 66%, which signals high confidence from analysts. 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 Antibe Therapeutics' upcoming projects, however, take into account that typically a pharma company has lumpy cash flows which are contingent on the drug and stage of product development the business is in. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
Before we wrap up, there’s one aspect worth mentioning. Antibe Therapeutics currently has no debt on its balance sheet, which is quite unusual for a cash-burning pharma, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on Antibe Therapeutics, so if you are interested in understanding the company at a deeper level, take a look at Antibe Therapeutics' company page on Simply Wall St. We've also put together a list of relevant factors you should look at:
Historical Track Record: What has Antibe Therapeutics' 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 Antibe Therapeutics' 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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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