Intra-Cellular Therapies, Inc. (NASDAQ:ITCI) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Intra-Cellular Therapies, Inc., a biopharmaceutical company, focuses on the discovery, clinical development, and commercialization of small molecule drugs that address medical needs primarily in neuropsychiatric and neurological disorders by targeting intracellular signaling mechanisms in the central nervous system (CNS) in the United States. The US$5.4b market-cap company posted a loss in its most recent financial year of US$256m and a latest trailing-twelve-month loss of US$184m shrinking the gap between loss and breakeven. The most pressing concern for investors is Intra-Cellular Therapies' path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
According to the 11 industry analysts covering Intra-Cellular Therapies, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$241m in 2025. So, the company is predicted to breakeven approximately 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 68% 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.
We're not going to go through company-specific developments for Intra-Cellular Therapies given that this is a high-level summary, though, take into account that generally pharmaceuticals, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
One thing we’d like to point out is that Intra-Cellular Therapies has no debt on its balance sheet, which is quite unusual for a cash-burning pharma, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.
There are key fundamentals of Intra-Cellular Therapies which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Intra-Cellular Therapies, take a look at Intra-Cellular Therapies' company page on Simply Wall St. We've also put together a list of important factors you should look at:
Valuation: What is Intra-Cellular Therapies 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 Intra-Cellular Therapies 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 Intra-Cellular Therapies’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.