Creo Medical Group PLC (LON:CREO): Is Breakeven Near?

Creo Medical Group PLC (LON:CREO) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Creo Medical Group PLC, through its subsidiaries, researches, develops, manufactures, and sells medical devices and instruments in the United Kingdom. With the latest financial year loss of UK£27m and a trailing-twelve-month loss of UK£25m, the UK£130m market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is Creo Medical Group's 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 Creo Medical Group

According to the 3 industry analysts covering Creo Medical Group, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of UK£7.2m in 2026. The company is therefore projected to breakeven around 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 68% year-on-year, on average, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Creo Medical Group's upcoming projects, however, bear in mind that generally 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 13% 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 key fundamentals of Creo Medical Group 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 Creo Medical Group, take a look at Creo Medical Group's company page on Simply Wall St. We've also compiled a list of relevant aspects you should further research:

1. Valuation: What is Creo Medical Group 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 Creo Medical Group 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 Creo Medical Group’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.