When Will Itamar Medical Ltd. (TLV:ITMR) Turn A Profit?

By
Simply Wall St
Published
December 11, 2020
TASE:ITMR

Itamar Medical Ltd. (TLV:ITMR) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Itamar Medical Ltd. engages in the research, development, marketing, sale, and leasing of non-invasive medical devices for the cardiology market. The ₪898m market-cap company posted a loss in its most recent financial year of US$5.3m and a latest trailing-twelve-month loss of US$9.0m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is Itamar Medical'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.

Check out our latest analysis for Itamar Medical

According to the 7 industry analysts covering Itamar Medical, the consensus is that breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of US$6.7m in 2023. The company is therefore projected to breakeven around 3 years from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 56%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
TASE:ITMR Earnings Per Share Growth December 11th 2020

We're not going to go through company-specific developments for Itamar Medical given that this is a high-level summary, though, 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 judiciously, with debt making up 11% 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 Itamar Medical to cover in one brief article, but the key fundamentals for the company can all be found in one place – Itamar Medical's company page on Simply Wall St. We've also put together a list of key factors you should further examine:

  1. Historical Track Record: What has Itamar Medical'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 Itamar Medical'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. 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.
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