Loss-Making Vitalhub Corp. (CVE:VHI) Set To Breakeven

Vitalhub Corp. (CVE:VHI) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Vitalhub Corp., together with its subsidiaries, develops technology solutions for health and human service providers in the mental health, long term care, community health service, home health, social service, acute care, and hospital sectors in Canada, the United Kingdom, and the United States. The CA$105m market-cap company posted a loss in its most recent financial year of CA$626k and a latest trailing-twelve-month loss of CA$1.5m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which Vitalhub will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Vitalhub

Vitalhub is bordering on breakeven, according to the 5 Canadian Healthcare Services analysts. They expect the company to post a final loss in 2020, before turning a profit of CA$1.6m in 2021. Therefore, the company is expected to breakeven roughly a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 176% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Vitalhub's growth isn’t the focus of this broad overview, however, take into account that generally 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. The company has managed its capital prudently, with debt making up 3.7% 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 Vitalhub to cover in one brief article, but the key fundamentals for the company can all be found in one place – Vitalhub's company page on Simply Wall St. We've also compiled a list of essential factors you should further research:

1. Valuation: What is Vitalhub 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 Vitalhub 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 Vitalhub’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.

When trading Vitalhub or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on 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.