iCAD, Inc. (NASDAQ:ICAD) Is Expected To Breakeven In The Near Future
We feel now is a pretty good time to analyse iCAD, Inc.'s (NASDAQ:ICAD) business as it appears the company may be on the cusp of a considerable accomplishment. iCAD, Inc. provides image analysis, workflow solutions, and radiation therapy for the treatment of cancer in the United States. With the latest financial year loss of US$18m and a trailing-twelve-month loss of US$7.4m, the US$436m market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is iCAD's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.
See our latest analysis for iCAD
Consensus from 10 of the American Healthcare Services analysts is that iCAD is on the verge of breakeven. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$131k in 2022. Therefore, the company is expected to breakeven just over a year from today. How fast will the company have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 68% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.
We're not going to go through company-specific developments for iCAD given that this is a high-level summary, however, bear in mind that by and large a healthcare tech company has lumpy cash flows which are contingent on the product and stage of development the company is in. 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 The company has managed its capital prudently, with debt making up 13% 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 iCAD, so if you are interested in understanding the company at a deeper level, take a look at iCAD's company page on Simply Wall St. We've also compiled a list of essential aspects you should further examine:
Valuation: What is iCAD 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 iCAD 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 iCAD’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.
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.
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