Alcidion Group Limited (ASX:ALC) Is Expected To Breakeven In The Near Future

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Alcidion Group Limited (ASX:ALC) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Alcidion Group Limited, together with its subsidiaries, engages in the development and licensing of healthcare software products in Australia, New Zealand, and the United Kingdom. With the latest financial year loss of AU$8.4m and a trailing-twelve-month loss of AU$5.0m, the AU$141m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Alcidion Group will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

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Consensus from 3 of the Australian Healthcare Services analysts is that Alcidion Group is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of AU$1.8m in 2026. The company is therefore projected 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 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 102% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Alcidion Group's growth isn’t the focus of this broad overview, however, bear in mind that typically healthcare tech companies, 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.

See our latest analysis for Alcidion Group

Before we wrap up, there’s one aspect worth mentioning. Alcidion Group currently has no debt on its balance sheet, which is quite unusual for a cash-burning healthcare tech company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

This article is not intended to be a comprehensive analysis on Alcidion Group, so if you are interested in understanding the company at a deeper level, take a look at Alcidion Group's company page on Simply Wall St. We've also compiled a list of important aspects you should further research:

1. Valuation: What is Alcidion Group 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 Alcidion Group is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Alcidion Group’s board and the CEO’s background.
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.

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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.