OrthoPediatrics Corp. (NASDAQ:KIDS) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. OrthoPediatrics Corp., a medical device company, designs, develops, and markets anatomically appropriate implants and devices for the treatment of children with orthopedic conditions in the United States and internationally. The US$1.0b market-cap company announced a latest loss of US$16m on 31 December 2021 for its most recent financial year result. Many investors are wondering about the rate at which OrthoPediatrics 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.
Consensus from 7 of the American Medical Equipment analysts is that OrthoPediatrics is on the verge of breakeven. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$3.7m in 2024. So, the company is predicted to breakeven approximately 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 43% 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.
Underlying developments driving OrthoPediatrics' growth isn’t the focus of this broad overview, but, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 0.5% 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.
There are too many aspects of OrthoPediatrics to cover in one brief article, but the key fundamentals for the company can all be found in one place – OrthoPediatrics' company page on Simply Wall St. We've also compiled a list of relevant factors you should further examine:
- Historical Track Record: What has OrthoPediatrics' 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.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on OrthoPediatrics' board and the CEO’s background.
- 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.
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.