When Will Citius Oncology, Inc. (NASDAQ:CTOR) Turn A Profit?

With the business potentially at an important milestone, we thought we'd take a closer look at Citius Oncology, Inc.'s (NASDAQ:CTOR) future prospects. Citius Oncology, Inc. focuses on the development and commercialization of innovative targeted oncology therapies. The company’s loss has recently broadened since it announced a US$21m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$27m, moving it further away from breakeven. The most pressing concern for investors is Citius Oncology's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

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Expectations from some of the American Biotechs analysts is that Citius Oncology is on the verge of breakeven. They anticipate the company to incur a final loss in 2026, before generating positive profits of US$61m in 2027. Therefore, the company is expected to breakeven roughly 2 years 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 65%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Citius Oncology's growth isn’t the focus of this broad overview, though, 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, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

Check out our latest analysis for Citius Oncology

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 12% 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:

There are too many aspects of Citius Oncology to cover in one brief article, but the key fundamentals for the company can all be found in one place – Citius Oncology's company page on Simply Wall St. We've also put together a list of relevant aspects you should further examine:

1. Valuation: What is Citius Oncology 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 Citius Oncology 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 Citius Oncology’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.