When Will BCAL Diagnostics Limited (ASX:BDX) Turn A Profit?

With the business potentially at an important milestone, we thought we'd take a closer look at BCAL Diagnostics Limited's (ASX:BDX) future prospects. BCAL Diagnostics Limited, a screening and diagnostic company, engages in developing a novel blood screening test to improve the diagnosis and monitoring of breast cancer. The AU$38m market-cap company announced a latest loss of AU$6.4m on 30 June 2024 for its most recent financial year result. The most pressing concern for investors is BCAL Diagnostics' path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for BCAL Diagnostics

According to some industry analysts covering BCAL Diagnostics, breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of AU$3.8m in 2026. Therefore, the company is expected to breakeven just over a year 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 91%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of BCAL Diagnostics' upcoming projects, though, take into account that typically biotechs, 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.

One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 7.5% 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 key fundamentals of BCAL Diagnostics 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 BCAL Diagnostics, take a look at BCAL Diagnostics' company page on Simply Wall St. We've also compiled a list of key aspects you should further examine:

1. Valuation: What is BCAL Diagnostics 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 BCAL Diagnostics 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 BCAL Diagnostics’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.