Analysts Expect Breakeven For NEXGEL, Inc. (NASDAQ:NXGL) Before Long

NEXGEL, Inc. (NASDAQ:NXGL) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. NEXGEL, Inc. manufactures and sells high water content, electron beam cross-linked, and aqueous polymer hydrogels and gels for wound care, medical diagnostics, transdermal drug delivery, and cosmetics in the United States. With the latest financial year loss of US$3.2m and a trailing-twelve-month loss of US$3.4m, the US$21m market-cap company amplified its loss by moving further away from its breakeven target. The most pressing concern for investors is NEXGEL's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

View our latest analysis for NEXGEL

According to some industry analysts covering NEXGEL, breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$263k in 2025. The company is therefore projected to breakeven just over a year from now. 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 69% is expected, which is extremely buoyant. 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 NEXGEL's upcoming projects, however, keep in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 16% 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:

There are key fundamentals of NEXGEL 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 NEXGEL, take a look at NEXGEL's company page on Simply Wall St. We've also compiled a list of relevant aspects you should further examine:

1. Historical Track Record: What has NEXGEL'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 NEXGEL'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.

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

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.