Aveanna Healthcare Holdings Inc. (NASDAQ:AVAH): Is Breakeven Near?

With the business potentially at an important milestone, we thought we'd take a closer look at Aveanna Healthcare Holdings Inc.'s (NASDAQ:AVAH) future prospects. Aveanna Healthcare Holdings Inc., a diversified home care platform company, provides pediatric and adult healthcare services in the United States. With the latest financial year loss of US$662m and a trailing-twelve-month loss of US$220m, the US$246m market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Aveanna Healthcare Holdings' investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Aveanna Healthcare Holdings

According to the 7 industry analysts covering Aveanna Healthcare Holdings, the consensus is that breakeven is near. They expect the company to post a final loss in 2023, before turning a profit of US$10m in 2024. 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 117% 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.

Underlying developments driving Aveanna Healthcare Holdings' growth isn’t the focus of this broad overview, though, take into account that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with Aveanna Healthcare Holdings is it currently has negative equity on its balance sheet. This can sometimes arise from accounting methods used to deal with accumulated losses from prior years, which are viewed as liabilities carried forward until it cancels out in the future. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

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

1. Valuation: What is Aveanna Healthcare Holdings 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 Aveanna Healthcare Holdings 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 Aveanna Healthcare Holdings’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.