Loss-Making Nanoform Finland Oyj (HEL:NANOFH) Expected To Breakeven In The Medium-Term

Nanoform Finland Oyj (HEL:NANOFH) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Nanoform Finland Oyj provides nanotechnology and drug particle engineering services for the pharmaceutical and biotech industry in Europe and the United States. With the latest financial year loss of €22m and a trailing-twelve-month loss of €21m, the €139m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Nanoform Finland Oyj's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for Nanoform Finland Oyj

According to the 2 industry analysts covering Nanoform Finland Oyj, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of €2.6m in 2026. So, the company is predicted to breakeven approximately 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 56% year-on-year, on average, which is rather optimistic! 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 Nanoform Finland Oyj given that this is a high-level summary, though, bear in mind that generally life science companies, depending on the stage of product development, have irregular periods of cash flow. 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 Nanoform Finland Oyj has no debt on its balance sheet, which is rare for a loss-making life science company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Nanoform Finland Oyj to cover in one brief article, but the key fundamentals for the company can all be found in one place – Nanoform Finland Oyj's company page on Simply Wall St. We've also compiled a list of essential aspects you should look at:

1. Historical Track Record: What has Nanoform Finland Oyj'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 Nanoform Finland 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.

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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.