Yahoo Finance Analysts Expect Breakeven For Futura Medical plc (LON:FUM) Before Long
With the business potentially at an important milestone, we thought we'd take a closer look at Futura Medical plc's (LON:FUM) future prospects. Futura Medical plc, a pharmaceutical company, develops pharmaceutical and healthcare products for the consumer healthcare markets focusing on sexual health and pain relief management. The UK£99m market-cap company announced a latest loss of UK£6.5m on 31 December 2023 for its most recent financial year result. The most pressing concern for investors is Futura Medical'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.
View our latest analysis for Futura Medical
Futura Medical is bordering on breakeven, according to the 3 British Pharmaceuticals analysts. They expect the company to post a final loss in 2024, before turning a profit of UK£2.5m in 2025. So, the company is predicted 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 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 112% 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.
Given this is a high-level overview, we won’t go into details of Futura Medical's upcoming projects, though, take into account that generally pharmaceuticals, depending on the stage of product development, have irregular periods of cash flow. So, 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 Futura Medical has no debt on its balance sheet, which is quite unusual for a cash-burning pharma, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of Futura Medical 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 Futura Medical, take a look at Futura Medical's company page on Simply Wall St. We've also put together a list of key aspects you should look at:
Valuation: What is Futura Medical 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 Futura Medical is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Futura Medical’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.
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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.
