Yahoo Finance When Will Aurinia Pharmaceuticals Inc. (NASDAQ:AUPH) Breakeven?
With the business potentially at an important milestone, we thought we'd take a closer look at Aurinia Pharmaceuticals Inc.'s (NASDAQ:AUPH) future prospects. Aurinia Pharmaceuticals Inc., a commercial-stage biopharmaceutical company, focuses on developing and commercializing therapies to treat various diseases with unmet medical need in the United States. The US$730m market-cap company announced a latest loss of US$78m on 31 December 2023 for its most recent financial year result. The most pressing concern for investors is Aurinia Pharmaceuticals' path to profitability – when will it 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 Aurinia Pharmaceuticals
According to the 7 industry analysts covering Aurinia Pharmaceuticals, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$59m 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 54% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
Given this is a high-level overview, we won’t go into details of Aurinia Pharmaceuticals' upcoming projects, however, take into account that by and large biotechs, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
One thing we’d like to point out is that Aurinia Pharmaceuticals has no debt on its balance sheet, which is quite unusual for a cash-burning biotech, which typically has high 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:
This article is not intended to be a comprehensive analysis on Aurinia Pharmaceuticals, so if you are interested in understanding the company at a deeper level, take a look at Aurinia Pharmaceuticals' company page on Simply Wall St. We've also put together a list of important factors you should further research:
Valuation: What is Aurinia Pharmaceuticals 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 Aurinia Pharmaceuticals 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 Aurinia Pharmaceuticals’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.
