Australia markets closed

Breakeven On The Horizon For Beyond Air, Inc. (NASDAQ:XAIR)

Simply Wall St

Beyond Air, Inc.'s (NASDAQ:XAIR): Beyond Air, Inc., a clinical-stage medical device and biopharmaceutical company, develops nitric oxide (NO) delivery systems to treat respiratory tract infections and other diseases. The US$85m market-cap posted a loss in its most recent financial year of -US$6.6m and a latest trailing-twelve-month loss of -US$15.3m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is XAIR’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for XAIR.

See our latest analysis for Beyond Air

XAIR is bordering on breakeven, according to the 4 Medical Equipment analysts. They expect the company to post a final loss in 2022, before turning a profit of US$24m in 2023. So, XAIR is predicted to breakeven approximately 3 years from now. What rate will XAIR 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 78%, which is extremely buoyant. If this rate turns out to be too aggressive, XAIR may become profitable much later than analysts predict.

NasdaqCM:XAIR Past and Future Earnings, February 18th 2020

Given this is a high-level overview, I won’t go into details of XAIR’s upcoming projects, however, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing I’d like to point out is that XAIR has no debt on its balance sheet, which is quite unusual for a cash-burning loss-making, growth company, which typically has high debt relative to its equity. This means that XAIR 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 XAIR which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at XAIR, take a look at XAIR’s company page on Simply Wall St. I’ve also put together a list of pertinent aspects you should further research:

  1. Historical Track Record: What has XAIR'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 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.

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.

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. Thank you for reading.