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Market Sentiment Around Loss-Making Beyond Air, Inc. (NASDAQ:XAIR)

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·3 min read
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With the business potentially at an important milestone, we thought we'd take a closer look at Beyond Air, Inc.'s (NASDAQ:XAIR) future prospects. Beyond Air, Inc., a clinical-stage medical device and biopharmaceutical company, develops inhaled nitric oxide (NO) to treat respiratory infections, and gaseous NO to treat solid tumors. With the latest financial year loss of US$20m and a trailing-twelve-month loss of US$21m, the US$98m market-cap company amplified its loss by moving further away from its breakeven target. The most pressing concern for investors is Beyond Air's path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for Beyond Air

Consensus from 4 of the American Medical Equipment analysts is that Beyond Air is on the verge of breakeven. They expect the company to post a final loss in 2022, before turning a profit of US$8.0m in 2023. Therefore, the company is expected to breakeven roughly 3 years from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 78% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
earnings-per-share-growth

We're not going to go through company-specific developments for Beyond Air given that this is a high-level summary, however, keep in mind that typically 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 judiciously, with debt making up 25% 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 Beyond Air, so if you are interested in understanding the company at a deeper level, take a look at Beyond Air's company page on Simply Wall St. We've also compiled a list of key aspects you should further research:

  1. Historical Track Record: What has Beyond Air's 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.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Beyond Air's board and the CEO’s background.

  3. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.