There's no doubt that money can be made by owning shares of unprofitable businesses. For example, biotech and mining exploration companies often lose money for years before finding success with a new treatment or mineral discovery. But the harsh reality is that very many loss making companies burn through all their cash and go bankrupt.
Given this risk, we thought we'd take a look at whether AcuCort (BST:NV5) shareholders should be worried about its cash burn. In this report, we will consider the company's annual negative free cash flow, henceforth referring to it as the 'cash burn'. First, we'll determine its cash runway by comparing its cash burn with its cash reserves.
Does AcuCort Have A Long Cash Runway?
A company's cash runway is calculated by dividing its cash hoard by its cash burn. When AcuCort last reported its March 2025 balance sheet in May 2025, it had zero debt and cash worth kr38m. In the last year, its cash burn was kr23m. So it had a cash runway of approximately 20 months from March 2025. While that cash runway isn't too concerning, sensible holders would be peering into the distance, and considering what happens if the company runs out of cash. You can see how its cash balance has changed over time in the image below.
Check out our latest analysis for AcuCort
How Well Is AcuCort Growing?
AcuCort reduced its cash burn by 4.7% during the last year, which points to some degree of discipline. And operating revenue was up by 16% too. Considering the factors above, the company doesn’t fare badly when it comes to assessing how it is changing over time. Of course, we've only taken a quick look at the stock's growth metrics, here. You can take a look at how AcuCort has developed its business over time by checking this visualization of its revenue and earnings history.
How Easily Can AcuCort Raise Cash?
AcuCort seems to be in a fairly good position, in terms of cash burn, but we still think it's worthwhile considering how easily it could raise more money if it wanted to. Companies can raise capital through either debt or equity. Commonly, a business will sell new shares in itself to raise cash and drive growth. We can compare a company's cash burn to its market capitalisation to get a sense for how many new shares a company would have to issue to fund one year's operations.
AcuCort's cash burn of kr23m is about 1.3% of its kr1.7b market capitalisation. That means it could easily issue a few shares to fund more growth, and might well be in a position to borrow cheaply.
So, Should We Worry About AcuCort's Cash Burn?
AcuCort appears to be in pretty good health when it comes to its cash burn situation. One the one hand we have its solid cash runway, while on the other it can also boast very strong cash burn relative to its market cap. Based on the factors mentioned in this article, we think its cash burn situation warrants some attention from shareholders, but we don't think they should be worried. On another note, we conducted an in-depth investigation of the company, and identified 4 warning signs for AcuCort (3 make us uncomfortable!) that you should be aware of before investing here.
Of course AcuCort may not be the best stock to buy. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks with high insider ownership.
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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.
About BST:NV5
AcuCort
Develops and commercializes glucocorticoid dexamethasone films for the treatment of acute allergic conditions.
Flawless balance sheet with slight risk.
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