Avanos Medical, Inc. (NYSE:AVNS) Is About To Turn The Corner

By
Simply Wall St
Published
May 18, 2021
NYSE:AVNS
Source: Shutterstock

We feel now is a pretty good time to analyse Avanos Medical, Inc.'s (NYSE:AVNS) business as it appears the company may be on the cusp of a considerable accomplishment. Avanos Medical, Inc. operates as a medical technology company that focuses on delivering medical device solutions to improve patients’ quality of life in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. The company’s loss has recently broadened since it announced a US$27m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$39m, moving it further away from breakeven. The most pressing concern for investors is Avanos Medical'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 Avanos Medical

According to the 7 industry analysts covering Avanos Medical, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2020, before generating positive profits of US$23m in 2021. So, the company is predicted to breakeven approximately a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 76% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
NYSE:AVNS Earnings Per Share Growth May 19th 2021

We're not going to go through company-specific developments for Avanos Medical given that this is a high-level summary, though, bear in mind that generally 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 prudently, with debt making up 14% 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 too many aspects of Avanos Medical to cover in one brief article, but the key fundamentals for the company can all be found in one place – Avanos Medical's company page on Simply Wall St. We've also compiled a list of relevant factors you should further research:

  1. Valuation: What is Avanos Medical 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 Avanos Medical 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 Avanos Medical’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.

When trading Avanos Medical or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted


Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.