Marrone Bio Innovations, Inc. (NASDAQ:MBII) Is Expected To Breakeven In The Near Future

Marrone Bio Innovations, Inc. (NASDAQ:MBII) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Marrone Bio Innovations, Inc. discovers, develops, produces, and promotes biological products for pest management, plant nutrition, and plant health in the United States and internationally. The US$323m market-cap company announced a latest loss of US$20m on 31 December 2020 for its most recent financial year result. The most pressing concern for investors is Marrone Bio Innovations' 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 Marrone Bio Innovations

According to the 5 industry analysts covering Marrone Bio Innovations, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$13m in 2023. So, the company is predicted to breakeven approximately 2 years from today. 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 59%, 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 Marrone Bio Innovations given that this is a high-level summary, though, bear in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with Marrone Bio Innovations is its relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Marrone Bio Innovations' case is 89%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Marrone Bio Innovations, so if you are interested in understanding the company at a deeper level, take a look at Marrone Bio Innovations' company page on Simply Wall St. We've also compiled a list of essential aspects you should further research:

1. Valuation: What is Marrone Bio Innovations 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 Marrone Bio Innovations 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 Marrone Bio Innovations’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. 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.
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