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AxoGen, Inc. (NASDAQ:AXGN): Is Breakeven Near?

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Simply Wall St
·3 min read
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With the business potentially at an important milestone, we thought we'd take a closer look at AxoGen, Inc.'s (NASDAQ:AXGN) future prospects. AxoGen, Inc., together with its subsidiaries, provides surgical solutions for physical damage or transection to peripheral nerves. The US$791m market-cap company posted a loss in its most recent financial year of US$29m and a latest trailing-twelve-month loss of US$25m shrinking the gap between loss and breakeven. The most pressing concern for investors is AxoGen's path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for AxoGen

AxoGen is bordering on breakeven, according to the 7 American Medical Equipment analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$6.1m in 2023. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 57% is expected, 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.

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

We're not going to go through company-specific developments for AxoGen given that this is a high-level summary, though, take into account that generally 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 judiciously, with debt making up 28% 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 too many aspects of AxoGen to cover in one brief article, but the key fundamentals for the company can all be found in one place – AxoGen's company page on Simply Wall St. We've also put together a list of relevant factors you should further research:

  1. Historical Track Record: What has AxoGen'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 AxoGen'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.