Xspray Pharma AB (publ)'s (STO:XSPRAY) Profit Outlook

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. With the latest financial year loss of kr286m and a trailing-twelve-month loss of kr216m, the kr1.2b market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Xspray Pharma'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.

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Consensus from 2 of the Swedish Biotechs analysts is that Xspray Pharma is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of kr418m in 2026. Therefore, the company is expected to breakeven just over a year 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 199% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Xspray Pharma given that this is a high-level summary, but, bear in mind that typically biotechs, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

View our latest analysis for Xspray Pharma

One thing we’d like to point out is that Xspray Pharma has no debt on its balance sheet, which is rare for a loss-making 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 too many aspects of Xspray Pharma to cover in one brief article, but the key fundamentals for the company can all be found in one place – Xspray Pharma's company page on Simply Wall St. We've also compiled a list of essential aspects 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.