Analysts Expect LigaChem Biosciences Inc. (KOSDAQ:141080) To Breakeven Soon

LigaChem Biosciences Inc. (KOSDAQ:141080) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. LigaChem Biosciences Inc. a clinical stage biopharmaceutical company, engages in the discovery and development of medicines for unmet medical needs. The ₩2.8t market-cap company’s loss lessened since it announced a ₩74b loss in the full financial year, compared to the latest trailing-twelve-month loss of ₩47b, as it approaches breakeven. As path to profitability is the topic on LigaChem Biosciences' investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for LigaChem Biosciences

Consensus from 2 of the South Korean Life Sciences analysts is that LigaChem Biosciences is on the verge of breakeven. They anticipate the company to incur a final loss in 2023, before generating positive profits of ₩26b in 2024. Therefore, the company is expected to breakeven roughly 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 34% is expected, 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.

Underlying developments driving LigaChem Biosciences' growth isn’t the focus of this broad overview, though, take into account that by and large life science companies, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 1.9% 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 LigaChem Biosciences 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 LigaChem Biosciences, take a look at LigaChem Biosciences' company page on Simply Wall St. We've also put together a list of pertinent aspects you should further examine:

1. Historical Track Record: What has LigaChem Biosciences' 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 LigaChem Biosciences' 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com