Aveanna Healthcare Holdings Inc.'s (NASDAQ:AVAH) Path To Profitability

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$135m and a trailing-twelve-month loss of US$114m, the US$477m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Aveanna Healthcare Holdings 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.

See our latest analysis for Aveanna Healthcare Holdings

According to the 8 industry analysts covering Aveanna Healthcare Holdings, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$13m in 2026. So, the company is predicted to breakeven approximately 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 109% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Aveanna Healthcare Holdings' upcoming projects, but, keep in mind that generally 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. Oftentimes, losses exist only on paper but other times, it can be a red flag.

Next Steps:

There are key fundamentals of Aveanna Healthcare Holdings 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 Aveanna Healthcare Holdings, take a look at Aveanna Healthcare Holdings' company page on Simply Wall St. We've also compiled a list of relevant 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com