Advertisement
U.S. markets closed
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • Dow 30

    39,807.37
    +47.29 (+0.12%)
     
  • Nasdaq

    16,379.46
    -20.06 (-0.12%)
     
  • Russell 2000

    2,124.55
    +10.20 (+0.48%)
     
  • Crude Oil

    83.05
    +1.70 (+2.09%)
     
  • Gold

    2,243.90
    +31.20 (+1.41%)
     
  • Silver

    24.99
    +0.24 (+0.96%)
     
  • EUR/USD

    1.0790
    -0.0040 (-0.37%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • GBP/USD

    1.2623
    -0.0015 (-0.12%)
     
  • USD/JPY

    151.3730
    +0.1270 (+0.08%)
     
  • Bitcoin USD

    70,731.17
    +1,850.55 (+2.69%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Nikkei 225

    40,168.07
    -594.66 (-1.46%)
     

Breakeven On The Horizon For Intra-Cellular Therapies, Inc. (NASDAQ:ITCI)

We feel now is a pretty good time to analyse Intra-Cellular Therapies, Inc.'s (NASDAQ:ITCI) business as it appears the company may be on the cusp of a considerable accomplishment. Intra-Cellular Therapies, Inc., a biopharmaceutical company, develops novel drugs for the treatment of neuropsychiatric and neurologic diseases, and other disorders of the central nervous system (CNS) in the United States. The US$2.5b market-cap company announced a latest loss of US$227m on 31 December 2020 for its most recent financial year result. As path to profitability is the topic on Intra-Cellular Therapies' 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 Intra-Cellular Therapies

According to the 2 industry analysts covering Intra-Cellular Therapies, the consensus is that breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of US$236m in 2024. So, the company is predicted to breakeven approximately 3 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 41% is expected, which is rather optimistic! 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

Underlying developments driving Intra-Cellular Therapies' growth isn’t the focus of this broad overview, however, keep in mind that by and large pharmaceuticals, depending on the stage of product development, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that Intra-Cellular Therapies has no debt on its balance sheet, which is rare for a loss-making pharma, which typically has high 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 Intra-Cellular Therapies, so if you are interested in understanding the company at a deeper level, take a look at Intra-Cellular Therapies' company page on Simply Wall St. We've also put together a list of key aspects you should further examine:

  1. Valuation: What is Intra-Cellular Therapies 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 Intra-Cellular Therapies is currently mispriced by the market.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Intra-Cellular Therapies’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.

Advertisement