Osprey Medical, Inc.'s (ASX:OSP) Path To Profitability

Osprey Medical, Inc. (ASX:OSP) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Osprey Medical, Inc., a commercial stage company, provides contrast reduction and monitoring technologies. The AU$36m market-cap company posted a loss in its most recent financial year of US$18m and a latest trailing-twelve-month loss of US$16m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Osprey Medical will turn a profit, with the big question being “when will the company 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 Osprey Medical

According to some industry analysts covering Osprey Medical, breakeven is near. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$2.0m in 2023. So, the company is predicted to breakeven approximately 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 72% is expected, 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 Osprey Medical's growth isn’t the focus of this broad overview, however, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 15% 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:

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

1. Valuation: What is Osprey Medical 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 Osprey Medical 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 Osprey Medical’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.

If you’re looking to trade Osprey Medical, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.