Blueprint Medicines Corporation (NASDAQ:BPMC) Is Expected To Breakeven In The Near Future

Blueprint Medicines Corporation (NASDAQ:BPMC) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Blueprint Medicines Corporation, a precision therapy company, develops medicines for genomically defined cancers and blood disorders in the United States and internationally. The US$6.6b market-cap company posted a loss in its most recent financial year of US$507m and a latest trailing-twelve-month loss of US$128m shrinking the gap between loss and breakeven. As path to profitability is the topic on Blueprint Medicines' investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

See our latest analysis for Blueprint Medicines

According to the 18 industry analysts covering Blueprint Medicines, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$106m in 2026. Therefore, the company is expected 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 55%, which signals high confidence from analysts. 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 Blueprint Medicines given that this is a high-level summary, but, bear in mind that by and large 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 high growth rate is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one issue worth mentioning. Blueprint Medicines currently has a debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Blueprint Medicines which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Blueprint Medicines, take a look at Blueprint Medicines' company page on Simply Wall St. We've also compiled a list of essential aspects you should further examine:

1. Valuation: What is Blueprint Medicines 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 Blueprint Medicines 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 Blueprint Medicines’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.