Probiodrug AG's (AMS:PBD): Probiodrug AG, a biopharmaceutical company, engages in the research and development of therapeutic products for the treatment of Alzheimer’s disease. The €21m market-cap company’s loss lessens since it announced a -€8.0m bottom-line in the full financial year, compared to the latest trailing-twelve-month loss of -€7.8m, as it approaches breakeven. The most pressing concern for investors is PBD’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for PBD.
Consensus from the 2 Biotechs analysts is PBD is on the verge of breakeven. They expect the company to post a final loss in 2020, before turning a profit of €35m in 2021. PBD is therefore projected to breakeven around 2 years from today. How fast will PBD have to grow each year in order to reach the breakeven point by 2021? Working backwards from analyst estimates, it turns out that they expect the company to grow 61% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, PBD may become profitable much later than analysts predict.
Underlying developments driving PBD’s growth isn’t the focus of this broad overview, but, bear in mind that by and large biotechs, depending on the stage of product development, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing I’d like to point out is that PBD has no debt on its balance sheet, which is rare for a loss-making biotech, which usually has a high level of debt relative to its equity. PBD currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
There are key fundamentals of PBD which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at PBD, take a look at PBD’s company page on Simply Wall St. I’ve also compiled a list of pertinent aspects you should further research:
- Historical Track Record: What has PBD'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.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Probiodrug’s board and the CEO’s back ground.
- 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.
If you decide to trade Vivoryon Therapeutics, use the lowest-cost* platform that is rated #1 Overall by Barron's, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account.
Simply Wall St has no position in any of the companies mentioned. This article 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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020