Market Sentiment Around Loss-Making STRATA Skin Sciences, Inc. (NASDAQ:SSKN)
STRATA Skin Sciences, Inc. (NASDAQ:SSKN) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. STRATA Skin Sciences, Inc., a medical technology company, develops, commercializes, and markets products for the treatment of dermatologic conditions in the United States, Europe, the Middle East, Asia, Australia, South Africa, and Central and South America. With the latest financial year loss of US$5.5m and a trailing-twelve-month loss of US$5.9m, the US$32m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which STRATA Skin Sciences will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.
See our latest analysis for STRATA Skin Sciences
STRATA Skin Sciences is bordering on breakeven, according to the 2 American Medical Equipment analysts. They expect the company to post a final loss in 2023, before turning a profit of US$70k in 2024. The company is therefore projected to breakeven just over a year 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 98% year-on-year, on average, which is extremely buoyant. 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 STRATA Skin Sciences given that this is a high-level summary, however, keep in mind that by and large 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 39% 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:
There are key fundamentals of STRATA Skin Sciences 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 STRATA Skin Sciences, take a look at STRATA Skin Sciences' company page on Simply Wall St. We've also put together a list of pertinent aspects you should further research:
Historical Track Record: What has STRATA Skin Sciences' performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on STRATA Skin Sciences' 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.
