Motus GI Holdings, Inc.’s (NASDAQ:MOTS) Path To Profitability

Motus GI Holdings, Inc.’s (NASDAQ:MOTS): Motus GI Holdings, Inc. operates as a medical technology company to enhance the endoscopy outcomes in the United States and Israel. With the latest financial year loss of -US$22.3m and a trailing-twelve month of -US$21.2m, the US$73m market-cap alleviates its loss by moving closer towards its target of breakeven. The most pressing concern for investors is MOTS’s path to profitability – when will it breakeven? I’ve put together a brief outline of industry analyst expectations for MOTS, its year of breakeven and its implied growth rate.

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Check out our latest analysis for Motus GI Holdings

MOTS is bordering on breakeven, according to the 5 Medical Equipment analysts. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$28m in 2022. Therefore, MOTS is expected to breakeven roughly 3 years from today. How fast will MOTS have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 68% 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.

NasdaqCM:MOTS Past and Future Earnings, May 24th 2019
NasdaqCM:MOTS Past and Future Earnings, May 24th 2019

Given this is a high-level overview, I won’t go into details of MOTS’s upcoming projects, though, take into account that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before I wrap up, there’s one aspect worth mentioning. MOTS has managed its capital judiciously, with debt making up 7.6% of equity. This means that MOTS 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 MOTS, so if you are interested in understanding the company at a deeper level, take a look at MOTS’s company page on Simply Wall St. I’ve also put together a list of key factors you should look at:

  1. Historical Track Record: What has MOTS’s 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.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Motus GI Holdings’s board and the CEO’s back ground.
  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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.