Analysts Expect dentalcorp Holdings Ltd. (TSE:DNTL) To Breakeven Soon

With the business potentially at an important milestone, we thought we'd take a closer look at dentalcorp Holdings Ltd.'s (TSE:DNTL) future prospects. dentalcorp Holdings Ltd., through its subsidiaries, engages in the acquiring and partnering with dental practices to provide health care services in Canada. The CA$1.6b market-cap company posted a loss in its most recent financial year of CA$86m and a latest trailing-twelve-month loss of CA$81m shrinking the gap between loss and breakeven. The most pressing concern for investors is dentalcorp Holdings' 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.

View our latest analysis for dentalcorp Holdings

According to the 9 industry analysts covering dentalcorp Holdings, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of CA$4.4m in 2025. Therefore, the company is expected to breakeven roughly 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 125%, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won’t go into details of dentalcorp Holdings' upcoming projects, though, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with dentalcorp Holdings is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in dentalcorp Holdings' case is 61%. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of dentalcorp Holdings to cover in one brief article, but the key fundamentals for the company can all be found in one place – dentalcorp Holdings' company page on Simply Wall St. We've also compiled a list of key factors you should look at:

1. Valuation: What is dentalcorp Holdings 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 dentalcorp Holdings 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 dentalcorp Holdings’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.