Stock Analysis

Santhera Pharmaceuticals Holding AG (VTX:SANN) On The Verge Of Breaking Even

SWX:SANN
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Santhera Pharmaceuticals Holding AG (VTX:SANN) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Santhera Pharmaceuticals Holding AG, a specialty pharmaceutical company, together with its subsidiaries, develops and commercializes medicines for rare neuromuscular and pulmonary diseases with high unmet medical need in the European Union and internationally. The CHF93m market-cap company’s loss lessened since it announced a CHF71m loss in the full financial year, compared to the latest trailing-twelve-month loss of CHF65m, as it approaches breakeven. As path to profitability is the topic on Santhera Pharmaceuticals Holding'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 Santhera Pharmaceuticals Holding

Santhera Pharmaceuticals Holding is bordering on breakeven, according to the 2 Swiss Biotechs analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of CHF49m in 2023. Therefore, the company is expected to breakeven roughly 12 months 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 48% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
SWX:SANN Earnings Per Share Growth October 5th 2023

Given this is a high-level overview, we won’t go into details of Santhera Pharmaceuticals Holding's upcoming projects, though, bear in mind that generally a biotech has lumpy cash flows which are contingent on the product type and stage of development the company is in. So, 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 Santhera Pharmaceuticals Holding is it currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. Oftentimes, losses exist only on paper but other times, it can be a red flag.

Next Steps:

There are key fundamentals of Santhera Pharmaceuticals Holding 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 Santhera Pharmaceuticals Holding, take a look at Santhera Pharmaceuticals Holding's company page on Simply Wall St. We've also compiled a list of essential factors you should further research:

  1. Valuation: What is Santhera Pharmaceuticals Holding 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 Santhera Pharmaceuticals Holding 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 Santhera Pharmaceuticals Holding’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.

Valuation is complex, but we're helping make it simple.

Find out whether Santhera Pharmaceuticals Holding is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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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.