When Will LifeStance Health Group, Inc. (NASDAQ:LFST) Become Profitable?

LifeStance Health Group, Inc. (NASDAQ:LFST) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. LifeStance Health Group, Inc., through its subsidiaries, provides outpatient mental health services to children, adolescents, adults, and geriatrics in the United States. On 31 December 2024, the US$2.5b market-cap company posted a loss of US$57m for its most recent financial year. The most pressing concern for investors is LifeStance Health Group's path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

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According to the 8 industry analysts covering LifeStance Health Group, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$7.4m in 2026. Therefore, the company is expected 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 94% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for LifeStance Health Group given that this is a high-level summary, but, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Check out our latest analysis for LifeStance Health Group

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 20% 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:

This article is not intended to be a comprehensive analysis on LifeStance Health Group, so if you are interested in understanding the company at a deeper level, take a look at LifeStance Health Group'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 LifeStance Health Group 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 LifeStance Health Group 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 LifeStance Health Group’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.