Plant Health Care plc's (LON:PHC) Profit Outlook

Plant Health Care plc (LON:PHC) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Plant Health Care plc, together with its subsidiaries, provides agricultural biological products and technology solutions in the Americas, Mexico, and internationally. With the latest financial year loss of US$9.5m and a trailing-twelve-month loss of US$5.7m, the UK£16m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Plant Health Care'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.

Check out our latest analysis for Plant Health Care

According to some industry analysts covering Plant Health Care, breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$2.8m in 2025. The company is therefore projected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 94% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won’t go into details of Plant Health Care's upcoming projects, though, take into account that generally 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 The company has managed its capital judiciously, with debt making up 3.2% 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:

This article is not intended to be a comprehensive analysis on Plant Health Care, so if you are interested in understanding the company at a deeper level, take a look at Plant Health Care's company page on Simply Wall St. We've also put together a list of key factors you should further examine:

1. Valuation: What is Plant Health Care 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 Plant Health Care 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 Plant Health Care’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.