Analysts Expect Breakeven For Xspray Pharma AB (publ) (STO:XSPRAY) Before Long

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We feel now is a pretty good time to analyse Xspray Pharma AB (publ)'s (STO:XSPRAY) business as it appears the company may be on the cusp of a considerable accomplishment. Xspray Pharma AB (publ), a pharmaceutical company, engages in the development of protein kinase inhibitors for targeted cancer treatments in Sweden. The kr1.6b market-cap company’s loss lessened since it announced a kr286m loss in the full financial year, compared to the latest trailing-twelve-month loss of kr251m, as it approaches breakeven. Many investors are wondering about the rate at which Xspray Pharma will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

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Consensus from 2 of the Swedish Biotechs analysts is that Xspray Pharma is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of kr227m in 2026. The company is therefore projected to breakeven just over a year from now. 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 104% is expected, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won’t go into details of Xspray Pharma's upcoming projects, however, bear in mind that typically 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.

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Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 18% 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:

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

1. Historical Track Record: What has Xspray Pharma'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 Xspray Pharma'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.