ARS Pharmaceuticals, Inc. (NASDAQ:SPRY): Are Analysts Optimistic?

We feel now is a pretty good time to analyse ARS Pharmaceuticals, Inc.'s (NASDAQ:SPRY) business as it appears the company may be on the cusp of a considerable accomplishment. ARS Pharmaceuticals, Inc., a biopharmaceutical company, develops treatments for severe allergic reactions. The US$817m market-cap company announced a latest loss of US$54m on 31 December 2023 for its most recent financial year result. Many investors are wondering about the rate at which ARS Pharmaceuticals will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for ARS Pharmaceuticals

Consensus from 3 of the American Biotechs analysts is that ARS Pharmaceuticals is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of US$40m in 2026. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 56% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving ARS Pharmaceuticals' growth isn’t the focus of this broad overview, but, take into account that generally biotechs, depending on the stage of product development, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. ARS Pharmaceuticals currently has no debt on its balance sheet, which is quite unusual for a cash-burning biotech, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

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

1. Historical Track Record: What has ARS Pharmaceuticals' 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.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on ARS Pharmaceuticals' 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.