Analysts Are Optimistic We'll See A Profit From Agios Pharmaceuticals, Inc. (NASDAQ:AGIO)

We feel now is a pretty good time to analyse Agios Pharmaceuticals, Inc.'s (NASDAQ:AGIO) business as it appears the company may be on the cusp of a considerable accomplishment. Agios Pharmaceuticals, Inc., a biopharmaceutical company, engages in the discovery and development of medicines in the field of cellular metabolism and adjacent areas of biology. With the latest financial year loss of US$327m and a trailing-twelve-month loss of US$334m, the US$3.8b market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Agios Pharmaceuticals will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Agios Pharmaceuticals

Agios Pharmaceuticals is bordering on breakeven, according to the 9 American Biotechs analysts. They anticipate the company to incur a final loss in 2020, before generating positive profits of US$1.1b in 2021. Therefore, the company is expected to breakeven roughly a year from now or less! How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2021? Working backwards from analyst estimates, it turns out that they expect the company to grow -50% year-on-year, on average,

Underlying developments driving Agios Pharmaceuticals' growth isn’t the focus of this broad overview, however, keep in mind that generally a biotech has lumpy cash flows which are contingent on the product type and stage of development the company is in. This means that a low or volatile growth rate in the near future is not unusual, especially if the company is currently in an investment period.

One thing we’d like to point out is that Agios Pharmaceuticals has no debt on its balance sheet, which is rare for a loss-making biotech, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Agios Pharmaceuticals to cover in one brief article, but the key fundamentals for the company can all be found in one place – Agios Pharmaceuticals' company page on Simply Wall St. We've also compiled a list of important aspects you should look at:

1. Historical Track Record: What has Agios Pharmaceuticals' 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 Agios Pharmaceuticals' 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 Agios Pharmaceuticals 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

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

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