Axogen, Inc. (NASDAQ:AXGN): Are Analysts Optimistic?

With the business potentially at an important milestone, we thought we'd take a closer look at Axogen, Inc.'s (NASDAQ:AXGN) future prospects. Axogen, Inc., together with its subsidiaries, develops and commercializes technologies for peripheral nerve regeneration and repair worldwide. The US$580m market-cap company posted a loss in its most recent financial year of US$22m and a latest trailing-twelve-month loss of US$17m shrinking the gap between loss and breakeven. As path to profitability is the topic on Axogen'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.

See our latest analysis for Axogen

Consensus from 6 of the American Medical Equipment analysts is that Axogen is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of US$493k in 2025. The company is therefore projected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 79% year-on-year, on average, which is rather optimistic! 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 Axogen's upcoming projects, though, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with Axogen is its relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Axogen's case is 52%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of Axogen to cover in one brief article, but the key fundamentals for the company can all be found in one place – Axogen's company page on Simply Wall St. We've also put together a list of important factors you should further examine:

1. Valuation: What is Axogen 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 Axogen 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 Axogen’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.