Yahoo Finance Market Sentiment Around Loss-Making Arcturus Therapeutics Holdings Inc. (NASDAQ:ARCT)
With the business potentially at an important milestone, we thought we'd take a closer look at Arcturus Therapeutics Holdings Inc.'s (NASDAQ:ARCT) future prospects. Arcturus Therapeutics Holdings Inc. operates as a late-stage clinical mRNA medicines and vaccines company. With the latest financial year loss of US$204m and a trailing-twelve-month loss of US$147m, the US$417m market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is Arcturus Therapeutics Holdings' path to profitability – when will it 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 Arcturus Therapeutics Holdings
According to the 9 industry analysts covering Arcturus Therapeutics Holdings, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2023, before generating positive profits of US$2.5m in 2024. Therefore, the company is expected to breakeven just over a year from today. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 64% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving Arcturus Therapeutics Holdings' growth isn’t the focus of this broad overview, though, bear in mind 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.
Before we wrap up, there’s one issue worth mentioning. Arcturus Therapeutics Holdings currently has a relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Arcturus Therapeutics Holdings' case is 41%. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.
Next Steps:
There are too many aspects of Arcturus Therapeutics Holdings to cover in one brief article, but the key fundamentals for the company can all be found in one place – Arcturus Therapeutics Holdings' company page on Simply Wall St. We've also put together a list of pertinent factors you should further examine:
Historical Track Record: What has Arcturus Therapeutics Holdings' 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.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Arcturus Therapeutics Holdings' 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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