Biomerica Inc’s (NASDAQ:BMRA): Biomerica, Inc., together with its subsidiaries, develops, manufactures, and markets medical diagnostic products for the early detection and monitoring of chronic diseases and medical conditions worldwide. The US$39.12M market-cap posted a loss in its most recent financial year of -US$908.56K and a latest trailing-twelve-month loss of -US$1.13M leading to an even wider gap between loss and breakeven. As path to profitability is the topic on BMRA’s investors mind, I’ve decided to gauge market sentiment. I’ve put together a brief outline of industry analyst expectations for BMRA, its year of breakeven and its implied growth rate.
Expectation from analysts is BMRA is on the verge of breakeven. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$7.43M in 2022. Therefore, BMRA is expected to breakeven roughly 4 years from now. How fast will BMRA have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 54.15% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, BMRA may become profitable much later than analysts predict.
Underlying developments driving BMRA’s growth isn’t the focus of this broad overview, however, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing I’d like to point out is that BMRA has no debt on its balance sheet, which is rare for a loss-making loss-making, growth company, which typically has high debt relative to its equity. This means that BMRA 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.
There are too many aspects of BMRA to cover in one brief article, but the key fundamentals for the company can all be found in one place – BMRA’s company page on Simply Wall St. I’ve also compiled a list of important aspects you should look at:
- Valuation: What is BMRA 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 BMRA 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 Biomerica’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 pass 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.