When Can We Expect A Profit From VBI Vaccines Inc. (NASDAQ:VBIV)?
With the business potentially at an important milestone, we thought we'd take a closer look at VBI Vaccines Inc.'s (NASDAQ:VBIV) future prospects. VBI Vaccines Inc., a biopharmaceutical company, develops and sells vaccines for the treatment of infectious diseases and immuno-oncology. The US$439m market-cap company announced a latest loss of US$70m on 31 December 2021 for its most recent financial year result. As path to profitability is the topic on VBI Vaccines' investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
View our latest analysis for VBI Vaccines
VBI Vaccines is bordering on breakeven, according to the 3 American Biotechs analysts. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$1.7m in 2024. The company is therefore projected to breakeven around 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 60% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Given this is a high-level overview, we won’t go into details of VBI Vaccines' upcoming projects, though, keep in mind that by and large 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.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 20% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on VBI Vaccines, so if you are interested in understanding the company at a deeper level, take a look at VBI Vaccines' company page on Simply Wall St. We've also put together a list of pertinent aspects you should look at:
Valuation: What is VBI Vaccines 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 VBI Vaccines 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 VBI Vaccines’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.
