With the business potentially at an important milestone, we thought we’d take a closer look at BioNTech SE’s ((NASDAQ:(BNTX))) future prospects. BioNTech SE, a biotechnology company, develops and commercializes immunotherapies for cancer and other infectious diseases. With the latest financial year loss of €179m and a trailing-twelve-month loss of €410m, the US$20b market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which BioNTech 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 BioNTech
According to the 10 industry analysts covering BioNTech, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2020, before generating positive profits of €3.5b in 2021. The company is therefore projected to breakeven around 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 17%, which seems relatively fair. However, if this rate turns out to be too buoyant, the company may become profitable later than analysts predict.
Given this is a high-level overview, we won’t go into details of BioNTech‘s upcoming projects, however, bear in mind that typically biotechs, depending on the stage of product development, have irregular periods of cash flow. This means, a double-digit growth rate is not abnormal as the company is beginning to reap the benefits of earlier investments.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 11% 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.
There are too many aspects of BioNTech to cover in one brief article, but the key fundamentals for the company can all be found in one place – BioNTech‘s company page on Simply Wall St. We’ve also put together a list of essential aspects you should further research:
- Valuation: What is BioNTech 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 BioNTech 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 BioNTech’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. 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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