Calyxt Inc’s (NASDAQ:CLXT): Calyxt, Inc., a consumer-centric food- and agriculture-focused company, develops healthier specialty food ingredients and food crops using gene-editing technology for plants in the United States. The company’s loss has recently broadened since it announced a -US$25.98m loss in the full financial year, compared to the latest trailing-twelve-month loss of -US$31.70m, moving it further away from breakeven. Many investors are wondering the rate at which CLXT will turn a profit, with the big question being “when will the company breakeven?” In this article, I will touch on the expectations for CLXT’s growth and when analysts expect the company to become profitable.
Check out our latest analysis for Calyxt
CLXT is bordering on breakeven, according to Biotechs analysts. They expect the company to post a final loss in 2020, before turning a profit of US$97.15m in 2021. CLXT is therefore projected to breakeven around a couple of months from now! How fast will CLXT have to grow each year in order to reach the breakeven point by 2021? Working backwards from analyst estimates, it turns out that they expect the company to grow 54.95% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.
I’m not going to go through company-specific developments for CLXT given that this is a high-level summary, however, bear 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 high growth rate is not unusual, especially if the company is currently in an investment period.
One thing I’d like to point out is that CLXT has managed its capital prudently, with debt making up 17.68% of equity. This means that CLXT 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 key fundamentals of CLXT which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at CLXT, take a look at CLXT’s company page on Simply Wall St. I’ve also put together a list of pertinent aspects you should further research:
- Historical Track Record: What has CLXT’s 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.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Calyxt’s board and the CEO’s back ground.
- 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.