Yahoo Finance When Will ChemoCentryx, Inc. (NASDAQ:CCXI) Breakeven?
ChemoCentryx, Inc. (NASDAQ:CCXI) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. ChemoCentryx, Inc., a clinical-stage biopharmaceutical company, focuses on the development and commercialization of new medications for inflammatory disorders, autoimmune diseases, and cancer in the United States. With the latest financial year loss of US$55m and a trailing-twelve-month loss of US$121m, the US$2.7b market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on ChemoCentryx's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
See our latest analysis for ChemoCentryx
According to the 8 industry analysts covering ChemoCentryx, the consensus is that breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of US$157m in 2024. Therefore, the company is expected to breakeven roughly 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 57%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving ChemoCentryx's growth isn’t the focus of this broad overview, though, take into account that generally biotechs, depending on the stage of product development, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 7.5% 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:
This article is not intended to be a comprehensive analysis on ChemoCentryx, so if you are interested in understanding the company at a deeper level, take a look at ChemoCentryx's company page on Simply Wall St. We've also put together a list of important factors you should further research:
Valuation: What is ChemoCentryx 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 ChemoCentryx 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 ChemoCentryx’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.
