We Might See A Profit From Osisko Development Corp. (CVE:ODV) Soon

Osisko Development Corp. (CVE:ODV) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Osisko Development Corp., a gold development company, engages in the acquisition, exploration, and development of precious metals resource properties in North America. The CA$294m market-cap company posted a loss in its most recent financial year of CA$192m and a latest trailing-twelve-month loss of CA$109m shrinking the gap between loss and breakeven. As path to profitability is the topic on Osisko Development's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for Osisko Development

Consensus from 3 of the Canadian Metals and Mining analysts is that Osisko Development is on the verge of breakeven. They expect the company to post a final loss in 2023, before turning a profit of CA$14m in 2024. So, the company is predicted to breakeven approximately 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 70%, which is rather optimistic! 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 Osisko Development's upcoming projects, however, bear in mind that by and large a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 2.5% 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 too many aspects of Osisko Development to cover in one brief article, but the key fundamentals for the company can all be found in one place – Osisko Development's company page on Simply Wall St. We've also put together a list of pertinent aspects you should further research:

1. Historical Track Record: What has Osisko Development's 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 Osisko Development'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.