BioInvent International AB (publ) (STO:BINV) Has Found A Path To Profitability

With the business potentially at an important milestone, we thought we'd take a closer look at BioInvent International AB (publ)'s (STO:BINV) future prospects. BioInvent International AB (publ), a clinical-stage company, discovers, and develops novel immuno-modulatory antibodies for the treatment of cancer in Sweden, Europe, the United States, and internationally. The company’s loss has recently broadened since it announced a kr429m loss in the full financial year, compared to the latest trailing-twelve-month loss of kr468m, moving it further away from breakeven. Many investors are wondering about the rate at which BioInvent International 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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Consensus from 2 of the Swedish Biotechs analysts is that BioInvent International is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of kr98m in 2025. Therefore, the company is expected to breakeven roughly 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 92%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving BioInvent International's growth isn’t the focus of this broad overview, but, keep in mind that generally a biotech has lumpy cash flows which are contingent on the product type and stage of development the company is in. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

See our latest analysis for BioInvent International

One thing we’d like to point out is that BioInvent International has no debt on its balance sheet, which is quite unusual for a cash-burning biotech, 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:

There are key fundamentals of BioInvent International 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 BioInvent International, take a look at BioInvent International's company page on Simply Wall St. We've also compiled a list of essential aspects you should further examine:

1. Historical Track Record: What has BioInvent International'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 BioInvent International'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.