Advertisement
U.S. markets closed
  • S&P Futures

    5,304.25
    -4.00 (-0.08%)
     
  • Dow Futures

    40,140.00
    -36.00 (-0.09%)
     
  • Nasdaq Futures

    18,465.00
    -38.75 (-0.21%)
     
  • Russell 2000 Futures

    2,145.20
    +6.80 (+0.32%)
     
  • Crude Oil

    83.11
    -0.06 (-0.07%)
     
  • Gold

    2,254.80
    +16.40 (+0.73%)
     
  • Silver

    25.10
    +0.18 (+0.74%)
     
  • EUR/USD

    1.0789
    -0.0005 (-0.04%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • Vix

    13.01
    +0.23 (+1.80%)
     
  • GBP/USD

    1.2624
    +0.0002 (+0.01%)
     
  • USD/JPY

    151.4720
    +0.1000 (+0.07%)
     
  • Bitcoin USD

    70,752.28
    +960.06 (+1.38%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Nikkei 225

    40,385.23
    +217.16 (+0.54%)
     

Tarsus Pharmaceuticals, Inc. (NASDAQ:TARS) Is Expected To Breakeven In The Near Future

We feel now is a pretty good time to analyse Tarsus Pharmaceuticals, Inc.'s (NASDAQ:TARS) business as it appears the company may be on the cusp of a considerable accomplishment. Tarsus Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on the development and commercialization of novel therapeutic candidates for ophthalmic conditions. On 31 December 2022, the US$359m market-cap company posted a loss of US$62m for its most recent financial year. Many investors are wondering about the rate at which Tarsus Pharmaceuticals 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.

View our latest analysis for Tarsus Pharmaceuticals

According to the 4 industry analysts covering Tarsus Pharmaceuticals, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$11m in 2025. Therefore, the company is expected to breakeven roughly 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 53% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

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

We're not going to go through company-specific developments for Tarsus Pharmaceuticals given that this is a high-level summary, but, keep in mind 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.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 10% 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 too many aspects of Tarsus Pharmaceuticals to cover in one brief article, but the key fundamentals for the company can all be found in one place – Tarsus Pharmaceuticals' company page on Simply Wall St. We've also compiled a list of key aspects you should look at:

  1. Historical Track Record: What has Tarsus Pharmaceuticals' 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 Tarsus Pharmaceuticals' 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.

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.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here

Advertisement