Fulgent Genetics, Inc.'s (NASDAQ:FLGT) Path To Profitability
Fulgent Genetics, Inc.'s (NASDAQ:FLGT): Fulgent Genetics, Inc., together with its subsidiaries, provides genetic testing services to physicians with clinically actionable diagnostic information. The US$271m market-cap company announced a latest loss of -US$411.0k on 31 December 2019 for its most recent financial year result. The most pressing concern for investors is FLGT’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for FLGT.
See our latest analysis for Fulgent Genetics
According to the 2 industry analysts covering FLGT, the consensus is breakeven is near. They anticipate the company to incur a final loss in 2020, before generating positive profits of US$3.4m in 2021. So, FLGT is predicted to breakeven approximately a few months from now. What rate will FLGT 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 147%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving FLGT’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.
Before I wrap up, there’s one aspect worth mentioning. FLGT currently has no debt on its balance sheet, which is quite unusual for a cash-burning loss-making, growth company, which typically has high debt relative to its equity. FLGT currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
Next Steps:
There are key fundamentals of FLGT which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at FLGT, take a look at FLGT’s company page on Simply Wall St. I’ve also compiled a list of pertinent factors you should further examine:
Valuation: What is FLGT 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 FLGT 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 Fulgent Genetics’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.
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.
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