Market Sentiment Around Loss-Making Visioneering Technologies, Inc. (ASX:VTI)

We feel now is a pretty good time to analyse Visioneering Technologies, Inc.'s (ASX:VTI) business as it appears the company may be on the cusp of a considerable accomplishment. Visioneering Technologies, Inc., a medical device company, engages in the design, manufacture, sale, and distribution of contact lenses in North America, Europe, and the Asia-Pacific. The AU$15m market-cap company announced a latest loss of US$2.3m on 31 December 2021 for its most recent financial year result. Many investors are wondering about the rate at which Visioneering Technologies 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.

View our latest analysis for Visioneering Technologies

Expectations from some of the Australian Medical Equipment analysts is that Visioneering Technologies is on the verge of breakeven. They expect the company to post a final loss in 2023, before turning a profit of US$900k in 2024. So, the company is predicted to breakeven approximately 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 25%, which is extremely buoyant. 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 Visioneering Technologies given that this is a high-level summary, though, take into account that by and large 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. The company has managed its capital judiciously, with debt making up 27% 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 too many aspects of Visioneering Technologies to cover in one brief article, but the key fundamentals for the company can all be found in one place – Visioneering Technologies' company page on Simply Wall St. We've also compiled a list of pertinent factors you should look at:

1. Historical Track Record: What has Visioneering Technologies' 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 Visioneering Technologies' 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.

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.