Yahoo Finance Analysts Expect Breakeven For TherapeuticsMD, Inc. (NASDAQ:TXMD)
TherapeuticsMD, Inc.'s (NASDAQ:TXMD): TherapeuticsMD, Inc. operates as a women’s health care product company in the United States. The company’s loss has recently broadened since it announced a -US$132.6m loss in the full financial year, compared to the latest trailing-twelve-month loss of -US$169.7m, moving it further away from breakeven. As path to profitability is the topic on TXMD’s investors mind, I’ve decided to gauge market sentiment. In this article, I will touch on the expectations for TXMD’s growth and when analysts expect the company to become profitable.
See our latest analysis for TherapeuticsMD
According to the 7 industry analysts covering TXMD, the consensus is breakeven is near. They expect the company to post a final loss in 2020, before turning a profit of US$150m in 2021. TXMD is therefore projected to breakeven around 2 years from today. What rate will TXMD have to grow year-on-year in order to breakeven on this date? Using a line of best fit, I calculated an average annual growth rate of 67%, which signals high confidence from analysts. If this rate turns out to be too aggressive, TXMD may become profitable much later than analysts predict.
Underlying developments driving TXMD’s growth isn’t the focus of this broad overview, however, keep in mind that generally a pharma company has lumpy cash flows which are contingent on the drug and stage of product development the business is in. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
Before I wrap up, there’s one issue worth mentioning. TXMD currently has a debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, and TXMD has considerably exceeded this. Note that a higher debt obligation increases the risk in investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on TXMD, so if you are interested in understanding the company at a deeper level, take a look at TXMD’s company page on Simply Wall St. I’ve also compiled a list of pertinent factors you should further examine:
Valuation: What is TXMD 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 TXMD 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 TherapeuticsMD’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.
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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
