When Will Conformis Inc (NASDAQ:CFMS) Become Profitable?
Conformis Inc’s (NASDAQ:CFMS): ConforMIS, Inc., a medical technology company, develops, manufactures, and sells joint replacement implants. The US$76.75m market-cap company’s loss lessens since it announced a -US$53.58m bottom-line in the full financial year, compared to the latest trailing-twelve-month loss of -US$48.42m, as it approaches breakeven. The most pressing concern for investors is CFMS’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for CFMS.
See our latest analysis for Conformis
Expectation from Medical Equipment analysts is CFMS is on the verge of breakeven. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$5.70m in 2022. Therefore, CFMS is expected to breakeven roughly a few months from now. What rate will CFMS have to grow year-on-year in order to breakeven on this date? Using a line of best fit, I calculated an average annual growth rate of 36.44%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving CFMS’s growth isn’t the focus of this broad overview, but, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing I would like to bring into light with CFMS is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in CFMS’s case is 49.25%. Note that a higher debt obligation increases the risk around investing in the loss-making company.
Next Steps:
There are too many aspects of CFMS to cover in one brief article, but the key fundamentals for the company can all be found in one place – CFMS’s company page on Simply Wall St. I’ve also compiled a list of key aspects you should further examine:
Historical Track Record: What has CFMS’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.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Conformis’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.
