Analysts Expect Breakeven For Alcidion Group Limited (ASX:ALC) Before Long

We feel now is a pretty good time to analyse Alcidion Group Limited's (ASX:ALC) business as it appears the company may be on the cusp of a considerable accomplishment. 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. The AU$78m market-cap company announced a latest loss of AU$8.4m on 30 June 2024 for its most recent financial year result. The most pressing concern for investors is Alcidion Group's 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.

Check out our latest analysis for Alcidion Group

Consensus from 3 of the Australian Healthcare Services analysts is that Alcidion Group is on the verge of breakeven. They expect the company to post a final loss in 2026, before turning a profit of AU$1.0m in 2027. The company is therefore projected to breakeven around 3 years from today. 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 104% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Alcidion Group given that this is a high-level summary, though, keep in mind that by and large healthcare tech companies, depending on the stage of product development, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

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. 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 Alcidion 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 Alcidion Group, take a look at Alcidion Group's company page on Simply Wall St. We've also compiled a list of pertinent factors you should look at:

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.