YSB Inc. (HKG:9885): Are Analysts Optimistic?

With the business potentially at an important milestone, we thought we'd take a closer look at YSB Inc.'s (HKG:9885) future prospects. YSB Inc. develops digital pharmaceutical platform for pharmaceutical companies, distributors, vendors, pharmacies, and primary healthcare institutions in China. With the latest financial year loss of CN¥1.5b and a trailing-twelve-month loss of CN¥4.0b, the HK$5.0b market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on YSB's investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.

View our latest analysis for YSB

Expectations from some of the Hong Kong Healthcare analysts is that YSB is on the verge of breakeven. They expect the company to post a final loss in 2023, before turning a profit of CN¥655m in 2024. 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 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 102% year-on-year, on average, which signals high confidence from analysts. 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 YSB's upcoming projects, but, bear in mind 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 YSB has no debt on its balance sheet, which is rare for a loss-making growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

There are key fundamentals of YSB 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 YSB, take a look at YSB's company page on Simply Wall St. We've also compiled a list of important factors you should further research:

1. Valuation: What is YSB 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 YSB 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 YSB’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.