Blueprint Medicines Corporation (NASDAQ:BPMC): When Will It Breakeven?
Blueprint Medicines Corporation (NASDAQ:BPMC) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Blueprint Medicines Corporation, a precision therapy company, develops medicines for genomically defined cancers and blood disorders in the United States and internationally. On 31 December 2023, the US$5.8b market-cap company posted a loss of US$507m for its most recent financial year. As path to profitability is the topic on Blueprint Medicines' investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Check out our latest analysis for Blueprint Medicines
Consensus from 16 of the American Biotechs analysts is that Blueprint Medicines is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$23m in 2026. The company is therefore projected to breakeven around 2 years from today. 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 66% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
We're not going to go through company-specific developments for Blueprint Medicines given that this is a high-level summary, but, take into account that by and large a biotech has lumpy cash flows which are contingent on the product type and stage of development the company is in. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
One thing we would like to bring into light with Blueprint Medicines is its debt-to-equity ratio of over 2x. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk in investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on Blueprint Medicines, so if you are interested in understanding the company at a deeper level, take a look at Blueprint Medicines' company page on Simply Wall St. We've also put together a list of essential factors you should further examine:
Valuation: What is Blueprint Medicines 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 Blueprint Medicines 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 Blueprint Medicines’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.
