GlycoMimetics Inc’s (NASDAQ:GLYC): GlycoMimetics, Inc., a clinical stage biotechnology company, focuses on the discovery and development of novel glycomimetic drugs to address unmet medical needs resulting from diseases in the United States. The US$673.91m market-cap posted a loss in its most recent financial year of -US$33.28m and a latest trailing-twelve-month loss of -US$36.86m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is GLYC’s path to profitability – when will it breakeven? Below I will provide a high-level summary of the industry analysts’ expectations for GLYC.See our latest analysis for GlycoMimetics
Expectation from Biotechs analysts is GLYC is on the verge of breakeven. They expect the company to post a final loss in 2021, before turning a profit of US$17.92m in 2022. GLYC is therefore projected to breakeven around a few months from now. How fast will GLYC have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 27.39% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, GLYC may become profitable much later than analysts predict.
I’m not going to go through company-specific developments for GLYC given that this is a high-level summary, though, keep 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. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
Before I wrap up, there’s one aspect worth mentioning. GLYC currently has no debt on its balance sheet, which is rare for a loss-making biotech, which typically has high debt relative to its equity. GLYC currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
This article is not intended to be a comprehensive analysis on GLYC, so if you are interested in understanding the company at a deeper level, take a look at GLYC’s company page on Simply Wall St. I’ve also put together a list of important factors you should further research:
- Valuation: What is GLYC 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 GLYC is currently mispriced by the market.
- Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on GlycoMimetics’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.