Numinus Wellness Inc. (TSE:NUMI) Is Expected To Breakeven In The Near Future

Numinus Wellness Inc. (TSE:NUMI) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Numinus Wellness Inc. provides psychedelic-assisted psychotherapy products and services in Canada and the United States. With the latest financial year loss of CA$30m and a trailing-twelve-month loss of CA$26m, the CA$9.7m market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is Numinus Wellness' 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.

View our latest analysis for Numinus Wellness

According to some industry analysts covering Numinus Wellness, breakeven is near. They anticipate the company to incur a final loss in 2026, before generating positive profits of CA$7.7m in 2027. The company is therefore projected to breakeven around 3 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 60%, 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 Numinus Wellness' upcoming projects, though, take into account that typically a pharma company has lumpy cash flows which are contingent on the drug and stage of product development the business is in. 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 35% 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:

This article is not intended to be a comprehensive analysis on Numinus Wellness, so if you are interested in understanding the company at a deeper level, take a look at Numinus Wellness' company page on Simply Wall St. We've also compiled a list of important factors you should further examine:

1. Historical Track Record: What has Numinus Wellness' 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 Numinus Wellness' 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.