BeiGene, Ltd. (NASDAQ:BGNE): When Will It Breakeven?

BeiGene, Ltd. (NASDAQ:BGNE) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. BeiGene, Ltd., an oncology company, engages in discovering and developing various treatments for cancer patients in the United States, China, Europe, and internationally. The US$25b market-cap company’s loss lessened since it announced a US$882m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$524m, as it approaches breakeven. Many investors are wondering about the rate at which BeiGene 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.

See our latest analysis for BeiGene

Consensus from 30 of the American Biotechs analysts is that BeiGene is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of US$352m in 2026. The company is therefore projected to breakeven around 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 66% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won’t go into details of BeiGene's upcoming projects, however, keep in mind that typically biotechs, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 31% 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 BeiGene, so if you are interested in understanding the company at a deeper level, take a look at BeiGene's company page on Simply Wall St. We've also put together a list of pertinent factors you should further examine:

1. Valuation: What is BeiGene 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 BeiGene 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 BeiGene’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. 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.