Yahoo Finance ReNeuron Group plc (LON:RENE): Is Breakeven Near?
We feel now is a pretty good time to analyse ReNeuron Group plc's (LON:RENE) business as it appears the company may be on the cusp of a considerable accomplishment. ReNeuron Group plc researches, develops, and commercializes cell-based therapies in the United Kingdom. On 31 March 2023, the UK£4.1m market-cap company posted a loss of UK£5.4m for its most recent financial year. Many investors are wondering about the rate at which ReNeuron Group will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
See our latest analysis for ReNeuron Group
Expectations from some of the British Biotechs analysts is that ReNeuron Group is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of UK£3.3m in 2025. So, the company is predicted to breakeven approximately 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 88% is expected, 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 ReNeuron Group's growth isn’t the focus of this broad overview, but, bear in mind that generally a biotech has lumpy cash flows which are contingent on the product type and stage of development the company is in. 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. ReNeuron Group currently has no debt on its balance sheet, which is rare for a loss-making biotech, 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 ReNeuron Group 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 ReNeuron Group, take a look at ReNeuron Group's company page on Simply Wall St. We've also put together a list of essential factors you should further examine:
Historical Track Record: What has ReNeuron Group'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.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on ReNeuron Group'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.
