Loss-Making Spago Nanomedical AB (publ) (STO:SPAG) Set To Breakeven

Spago Nanomedical AB (publ) (STO:SPAG) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Spago Nanomedical AB (publ) develops nanomaterials for cancer diagnostics and treatment. On 31 December 2020, the kr362m market-cap company posted a loss of kr19m for its most recent financial year. As path to profitability is the topic on Spago Nanomedical's 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.

Check out our latest analysis for Spago Nanomedical

Spago Nanomedical is bordering on breakeven, according to some Swedish Biotechs analysts. They anticipate the company to incur a final loss in 2020, before generating positive profits of kr23m in 2021. So, the company is predicted to breakeven approximately a year 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 -42% is expected,

Given this is a high-level overview, we won’t go into details of Spago Nanomedical's upcoming projects, however, bear in mind that by and large biotechs, depending on the stage of product development, have irregular periods of cash flow. So, periods of lower growth in the upcoming years is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that Spago Nanomedical 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. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

This article is not intended to be a comprehensive analysis on Spago Nanomedical, so if you are interested in understanding the company at a deeper level, take a look at Spago Nanomedical's 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 Spago Nanomedical'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 Spago Nanomedical'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. 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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