When Will GeneDx Holdings Corp. (NASDAQ:WGS) Turn A Profit?

With the business potentially at an important milestone, we thought we'd take a closer look at GeneDx Holdings Corp.'s (NASDAQ:WGS) future prospects. GeneDx Holdings Corp., a genomics company, provides personalized and actionable health insights to inform diagnosis, direct treatment, and improve drug discovery. The US$2.2b market-cap company posted a loss in its most recent financial year of US$176m and a latest trailing-twelve-month loss of US$83m shrinking the gap between loss and breakeven. The most pressing concern for investors is GeneDx Holdings' 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.

View our latest analysis for GeneDx Holdings

Consensus from 6 of the American Healthcare analysts is that GeneDx Holdings is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$15m in 2026. So, the company is predicted to breakeven just over a year from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 94%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for GeneDx Holdings given that this is a high-level summary, though, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 25% 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 GeneDx Holdings, so if you are interested in understanding the company at a deeper level, take a look at GeneDx Holdings' company page on Simply Wall St. We've also compiled a list of pertinent aspects you should look at:

1. Historical Track Record: What has GeneDx Holdings' 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 GeneDx Holdings' 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.