When Will BioPorto A/S (CPH:BIOPOR) Breakeven?
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BioPorto A/S’s (CPH:BIOPOR): BioPorto A/S, an in-vitro diagnostics company, provides diagnostic tests and antibodies for healthcare professionals in clinical and research settings worldwide. On 31 December 2018, the ø656m market-cap posted a loss of -ø38.0m for its most recent financial year. As path to profitability is the topic on BIOPOR’s investors mind, I’ve decided to gauge market sentiment. Below I will provide a high-level summary of the industry analysts’ expectations for BIOPOR.
View our latest analysis for BioPorto
According to the industry analysts covering BIOPOR, breakeven is near. They anticipate the company to incur a final loss in 2020, before generating positive profits of ø45m in 2021. So, BIOPOR is predicted to breakeven approximately 2 years from now. In order to meet this breakeven date, I calculated the rate at which BIOPOR must grow year-on-year. It turns out an average annual growth rate of 66% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, BIOPOR may become profitable much later than analysts predict.
Underlying developments driving BIOPOR’s growth isn’t the focus of this broad overview, though, keep in mind that typically biotechs, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
Before I wrap up, there’s one aspect worth mentioning. BIOPOR currently has no debt on its balance sheet, which is quite unusual for a cash-burning biotech, which usually has a high level of debt relative to its equity. This means that BIOPOR 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 BIOPOR, so if you are interested in understanding the company at a deeper level, take a look at BIOPOR’s company page on Simply Wall St. I’ve also compiled a list of pertinent aspects you should look at:
Valuation: What is BIOPOR 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 BIOPOR 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 BioPorto’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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
