Zylox-Tonbridge Medical Technology Co., Ltd.'s (HKG:2190) Profit Outlook

We feel now is a pretty good time to analyse Zylox-Tonbridge Medical Technology Co., Ltd.'s (HKG:2190) business as it appears the company may be on the cusp of a considerable accomplishment. Zylox-Tonbridge Medical Technology Co., Ltd., a medical device company, provides neuro- and peripheral-vascular interventional medical devices the People’s Republic of China and internationally. The HK$4.6b market-cap company posted a loss in its most recent financial year of CN¥114m and a latest trailing-twelve-month loss of CN¥124m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which Zylox-Tonbridge Medical Technology will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Zylox-Tonbridge Medical Technology

According to the 4 industry analysts covering Zylox-Tonbridge Medical Technology, the consensus is that breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of CN¥34m in 2024. The company is therefore projected to breakeven just over a year from today. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 108% year-on-year, on average, which is rather optimistic! 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 Zylox-Tonbridge Medical Technology's upcoming projects, however, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 0.3% 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 Zylox-Tonbridge Medical Technology to cover in one brief article, but the key fundamentals for the company can all be found in one place – Zylox-Tonbridge Medical Technology's company page on Simply Wall St. We've also put together a list of key aspects you should look at:

1. Historical Track Record: What has Zylox-Tonbridge Medical Technology'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 Zylox-Tonbridge Medical Technology'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.