Osisko Development Corp. (CVE:ODV) Could Be Less Than A Year Away From Profitability
With the business potentially at an important milestone, we thought we'd take a closer look at Osisko Development Corp.'s (CVE:ODV) future prospects. Osisko Development Corp., a gold development company, engages in the acquisition, exploration, and development of precious metals resource properties in North America. The CA$324m market-cap company posted a loss in its most recent financial year of CA$192m and a latest trailing-twelve-month loss of CA$109m shrinking the gap between loss and breakeven. The most pressing concern for investors is Osisko Development's 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.
Check out our latest analysis for Osisko Development
Osisko Development is bordering on breakeven, according to the 3 Canadian Metals and Mining analysts. They anticipate the company to incur a final loss in 2023, before generating positive profits of CA$14m in 2024. The company is therefore projected to breakeven around 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 70% 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.
We're not going to go through company-specific developments for Osisko Development given that this is a high-level summary, though, keep in mind that typically a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 2.5% 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 Osisko Development 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 Osisko Development, take a look at Osisko Development's company page on Simply Wall St. We've also put together a list of important aspects you should further research:
Historical Track Record: What has Osisko Development'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.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Osisko Development'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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
