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When Can We Expect A Profit From NOXXON Pharma N.V. (EPA:ALNOX)?

Simply Wall St

NOXXON Pharma N.V.'s (EPA:ALNOX): NOXXON Pharma N.V., a clinical-stage biopharmaceutical company, focuses on the development of proprietary therapeutics for the treatment of cancer in Germany. The €4.8m market-cap company’s loss lessens since it announced a -€10.7m bottom-line in the full financial year, compared to the latest trailing-twelve-month loss of -€8.6m, as it approaches breakeven. Many investors are wondering the rate at which ALNOX will turn a profit, with the big question being “when will the company breakeven?” In this article, I will touch on the expectations for ALNOX’s growth and when analysts expect the company to become profitable.

Check out our latest analysis for NOXXON Pharma

Expectation from Biotechs analysts is ALNOX is on the verge of breakeven. They expect the company to post a final loss in 2021, before turning a profit of €19m in 2022. Therefore, ALNOX is expected to breakeven roughly 3 years from today. In order to meet this breakeven date, I calculated the rate at which ALNOX must grow year-on-year. It turns out an average annual growth rate of 50% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

ENXTPA:ALNOX Past and Future Earnings, November 11th 2019

Underlying developments driving ALNOX’s growth isn’t the focus of this broad overview, though, take into account that generally biotechs, 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 I would like to bring into light with ALNOX is it currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

There are too many aspects of ALNOX to cover in one brief article, but the key fundamentals for the company can all be found in one place – ALNOX’s company page on Simply Wall St. I’ve also put together a list of key aspects you should further research:

  1. Valuation: What is ALNOX 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 ALNOX 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 NOXXON Pharma’s board and the CEO’s back ground.
  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.

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.