Market Sentiment Around Loss-Making BrainCool AB (publ) (STO:BRAIN)

With the business potentially at an important milestone, we thought we'd take a closer look at BrainCool AB (publ)'s (STO:BRAIN) future prospects. BrainCool AB (publ), a medical device company, together with its subsidiaries, engages in the development, marketing, and sale of medical cooling systems for the healthcare sector in Sweden. On 31 December 2024, the kr410m market-cap company posted a loss of kr44m for its most recent financial year. Many investors are wondering about the rate at which BrainCool 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.

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According to some industry analysts covering BrainCool, breakeven is near. They expect the company to post a final loss in 2026, before turning a profit of kr15m in 2027. The company is therefore projected to breakeven around 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2027? Working backwards from analyst estimates, it turns out that they expect the company to grow 95% year-on-year, on average, which is extremely buoyant. 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 BrainCool's upcoming projects, though, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

See our latest analysis for BrainCool

Before we wrap up, there’s one aspect worth mentioning. BrainCool currently 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. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on BrainCool, so if you are interested in understanding the company at a deeper level, take a look at BrainCool's company page on Simply Wall St. We've also compiled a list of important factors you should further examine:

1. Valuation: What is BrainCool 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 BrainCool 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 BrainCool’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.