Yahoo Finance Geron Corporation (NASDAQ:GERN) Is Expected To Breakeven In The Near Future
We feel now is a pretty good time to analyse Geron Corporation's (NASDAQ:GERN) business as it appears the company may be on the cusp of a considerable accomplishment. Geron Corporation, a late-stage clinical biopharmaceutical company, focuses on the development and commercialization of therapeutics for myeloid hematologic malignancies. The US$2.0b market-cap company announced a latest loss of US$184m on 31 December 2023 for its most recent financial year result. As path to profitability is the topic on Geron's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Check out our latest analysis for Geron
Geron is bordering on breakeven, according to the 6 American Biotechs analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$44m in 2026. The company is therefore projected to breakeven around 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 62% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Underlying developments driving Geron's growth isn’t the focus of this broad overview, though, keep in mind that by and large a biotech has lumpy cash flows which are contingent on the product type and stage of development the company is in. 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 The company has managed its capital prudently, with debt making up 33% 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:
There are key fundamentals of Geron 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 Geron, take a look at Geron's company page on Simply Wall St. We've also put together a list of key aspects you should further research:
Historical Track Record: What has Geron'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 Geron'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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
