TaiMed Biologics Inc.'s (GTSM:4147) Profit Outlook

By
Simply Wall St
Published
April 20, 2021
TPEX:4147

TaiMed Biologics Inc. (GTSM:4147) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. TaiMed Biologics Inc., a biotechnology company, develops health-care products. On 31 December 2020, the NT$19b market-cap company posted a loss of NT$183m for its most recent financial year. Many investors are wondering about the rate at which TaiMed Biologics 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.

View our latest analysis for TaiMed Biologics

TaiMed Biologics is bordering on breakeven, according to the 2 Taiwanese Biotechs analysts. They anticipate the company to incur a final loss in 2021, before generating positive profits of NT$376m in 2022. The company is therefore projected 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 116% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth
GTSM:4147 Earnings Per Share Growth April 21st 2021

We're not going to go through company-specific developments for TaiMed Biologics given that this is a high-level summary, 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 that a high growth rate is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 16% 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:

There are key fundamentals of TaiMed Biologics 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 TaiMed Biologics, take a look at TaiMed Biologics' company page on Simply Wall St. We've also compiled a list of relevant factors you should further research:

  1. Valuation: What is TaiMed Biologics 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 TaiMed Biologics 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 TaiMed Biologics’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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