Breakeven On The Horizon For Optomed Oyj (HEL:OPTOMED)

Optomed Oyj (HEL:OPTOMED) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Optomed Oyj, a medical technology company, manufactures and sells handheld fundus cameras and screening software in Finland, China, and internationally. The company’s loss has recently broadened since it announced a €4.2m loss in the full financial year, compared to the latest trailing-twelve-month loss of €6.0m, moving it further away from breakeven. Many investors are wondering about the rate at which Optomed Oyj will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Our analysis indicates that OPTOMED is potentially undervalued!

According to the 3 industry analysts covering Optomed Oyj, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2023, before generating positive profits of €200k in 2024. Therefore, the company is expected to breakeven roughly 2 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 83%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Optomed Oyj given that this is a high-level summary, though, keep in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 31% 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 Optomed Oyj to cover in one brief article, but the key fundamentals for the company can all be found in one place – Optomed Oyj's company page on Simply Wall St. We've also compiled a list of key factors you should further examine:

1. Valuation: What is Optomed Oyj 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 Optomed Oyj 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 Optomed Oyj’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.