Gentian Diagnostics AS (OB:GENT): When Will It Breakeven?

With the business potentially at an important milestone, we thought we'd take a closer look at Gentian Diagnostics AS' (OB:GENT) future prospects. Gentian Diagnostics AS researches, develops, and produces biochemical reagents for use in medical diagnostics and research in Europe, Asia, the United States. The kr893m market-cap company posted a loss in its most recent financial year of kr40m and a latest trailing-twelve-month loss of kr21m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Gentian Diagnostics will turn a profit, with the big question being “when will the company breakeven?” 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 Gentian Diagnostics

Gentian Diagnostics is bordering on breakeven, according to some Norwegian Medical Equipment analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of kr5.0m in 2023. The company is therefore projected to breakeven around 3 years from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 61% is expected, which is rather optimistic! 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 Gentian Diagnostics' upcoming projects, but, keep in mind that typically 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 prudently, with debt making up -1.2% 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 Gentian Diagnostics 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 Gentian Diagnostics, take a look at Gentian Diagnostics' company page on Simply Wall St. We've also compiled a list of relevant aspects you should further examine:

1. Historical Track Record: What has Gentian Diagnostics' 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 Gentian Diagnostics' 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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