We feel now is a pretty good time to analyse ABL Bio Inc.'s (KOSDAQ:298380) business as it appears the company may be on the cusp of a considerable accomplishment. ABL Bio Inc., a biotech research company, focuses on the development of therapeutic drugs for immuno-oncology and neurodegenerative diseases. The ₩4.5t market-cap company’s loss lessened since it announced a ₩38b loss in the full financial year, compared to the latest trailing-twelve-month loss of ₩24b, as it approaches breakeven. Many investors are wondering about the rate at which ABL Bio will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
According to the 4 industry analysts covering ABL Bio, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of ₩1.7b in 2026. The company is therefore projected to breakeven around a year from now or less! We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 36% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Underlying developments driving ABL Bio's growth isn’t the focus of this broad overview, however, take into account that typically 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.
View our latest analysis for ABL Bio
One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 30% 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:
This article is not intended to be a comprehensive analysis on ABL Bio, so if you are interested in understanding the company at a deeper level, take a look at ABL Bio's company page on Simply Wall St. We've also compiled a list of relevant factors you should further examine:
- Valuation: What is ABL Bio 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 ABL Bio 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 ABL Bio’s board and the CEO’s background.
- 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.