U.S. Markets closed

Zur Rose Group AG (VTX:ROSE): Are Analysts Optimistic?

Simply Wall St

Zur Rose Group AG's (VTX:ROSE): Zur Rose Group AG, an online pharmacy company, wholesales products to medical practitioners under the Zur Rose and DocMorris brands in Germany and Austria. The CHF832m market-cap posted a loss in its most recent financial year of -CHF39.0m and a latest trailing-twelve-month loss of -CHF38.6m shrinking the gap between loss and breakeven. The most pressing concern for investors is ROSE’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for ROSE.

Check out our latest analysis for Zur Rose Group

Consensus from the 6 Consumer Retailing analysts is ROSE is on the verge of breakeven. They expect the company to post a final loss in 2020, before turning a profit of CHF21m in 2021. ROSE is therefore projected to breakeven around 2 years from today. What rate will ROSE have to grow year-on-year in order to breakeven on this date? Using a line of best fit, I calculated an average annual growth rate of 89%, which is extremely buoyant. If this rate turns out to be too aggressive, ROSE may become profitable much later than analysts predict.

SWX:ROSE Past and Future Earnings, November 19th 2019

I’m not going to go through company-specific developments for ROSE given that this is a high-level summary, though, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before I wrap up, there’s one aspect worth mentioning. ROSE has managed its capital prudently, with debt making up 25% of equity. This means that ROSE 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 ROSE to cover in one brief article, but the key fundamentals for the company can all be found in one place – ROSE’s company page on Simply Wall St. I’ve also compiled a list of key aspects you should look at:

  1. Valuation: What is ROSE 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 ROSE is currently mispriced by the market.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Zur Rose Group’s board and the CEO’s back ground.
  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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.