When Will MannKind Corporation (NASDAQ:MNKD) Turn A Profit?

MannKind Corporation's (NASDAQ:MNKD): MannKind Corporation, a biopharmaceutical company, focuses on the development and commercialization of inhaled therapeutic products for diabetes and pulmonary arterial hypertension patients. On 31 December 2017, the US$310.25M market-cap posted a loss of -US$117.33M for its most recent financial year. As path to profitability is the topic on MNKD’s investors mind, I’ve decided to gauge market sentiment. In this article, I will touch on the expectations for MNKD’s growth and when analysts expect the company to become profitable.

According to the industry analysts covering MNKD, breakeven is near. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$55.07M in 2022. So, MNKD is predicted to breakeven approximately 4 years from today. In order to meet this breakeven date, I calculated the rate at which MNKD must grow year-on-year. It turns out an average annual growth rate of 47.77% is expected, which is rather optimistic! If this rate turns out to be too aggressive, MNKD may become profitable much later than analysts predict.

Underlying developments driving MNKD’s growth isn’t the focus of this broad overview, however, take into account that by and large biotechs, depending on the stage of product development, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

One thing I would like to bring into light with MNKD is it currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. Oftentimes, losses exist only on paper but other times, it can be a red flag.

Next Steps:

There are too many aspects of MNKD to cover in one brief article, but the key fundamentals for the company can all be found in one place – MNKD’s company page on Simply Wall St. I’ve also compiled a list of important aspects you should further examine:

1. Valuation: What is MNKD 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 MNKD 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 MannKind’s board and the CEO’s back ground.
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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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.