Zur Rose Group AG’s (VTX:ROSE) Path To Profitability

Zur Rose Group AG’s (VTX:ROSE): Zur Rose Group AG, an online pharmacy company, wholesales products to medical practitioners under the Zur Rose and DocMorris brands in Germany and Austria. The CHF1.1b market-cap company’s loss lessens since it announced a -CHF39.0m bottom-line in the full financial year, compared to the latest trailing-twelve-month loss of -CHF38.6m, as it approaches breakeven. Many investors are wondering the rate at which ROSE will turn a profit, with the big question being “when will the company breakeven?” Below I will provide a high-level summary of the industry analysts’ expectations for ROSE.

Check out our latest analysis for Zur Rose Group

Consensus from the 6 Consumer Retailing analysts is ROSE is on the verge of breakeven. They anticipate the company to incur a final loss in 2020, before generating positive profits of CHF20m in 2021. So, ROSE is predicted to breakeven approximately a couple of months from now! What rate will ROSE 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 89%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

SWX:ROSE Past and Future Earnings, February 17th 2020
SWX:ROSE Past and Future Earnings, February 17th 2020

Underlying developments driving ROSE’s growth isn’t the focus of this broad overview, however, bear in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before I wrap up, there’s one aspect worth mentioning. ROSE has managed its capital judiciously, with debt making up 25% of equity. This means that ROSE 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 ROSE, so if you are interested in understanding the company at a deeper level, take a look at ROSE’s company page on Simply Wall St. I’ve also put together a list of pertinent factors you should further examine:

  1. Historical Track Record: What has ROSE’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 Zur Rose Group’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.

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