Yahoo News Profound Medical Corp.'s (TSE:PRN) Profit Outlook
Profound Medical Corp.'s (TSE:PRN): Profound Medical Corp. operates as a medical technology company focuses on magnetic resonance guided ablation procedures in Canada, Germany, and Finland. On 31 December 2019, the CA$216m market-cap posted a loss of -CA$20.2m for its most recent financial year. As path to profitability is the topic on PRN’s investors mind, I’ve decided to gauge market sentiment. Below I will provide a high-level summary of the industry analysts’ expectations for PRN.
Check out our latest analysis for Profound Medical
PRN is bordering on breakeven, according to the 7 Medical Equipment analysts. They anticipate the company to incur a final loss in 2021, before generating positive profits of CA$1.9m in 2022. So, PRN is predicted to breakeven approximately 2 years from now. How fast will PRN have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 53% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, PRN may become profitable much later than analysts predict.
Underlying developments driving PRN’s growth isn’t the focus of this broad overview, however, bear in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing I would like to bring into light with PRN is its relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in PRN’s case is 64%. Note that a higher debt obligation increases the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of PRN which are not covered in this article, but I must stress again that this is merely a basic overview. For a more comprehensive look at PRN, take a look at PRN’s company page on Simply Wall St. I’ve also compiled a list of important factors you should further research:
Valuation: What is PRN 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 PRN 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 Profound Medical’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.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
