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We feel now is a pretty good time to analyse Creo Medical Group PLC's (LON:CREO) business as it appears the company may be on the cusp of a considerable accomplishment. Creo Medical Group PLC, through its subsidiaries, engages in the research, development, manufacture, and sale of medical devices and instruments in the United Kingdom. The UK£103m market-cap company announced a latest loss of UK£22m on 31 December 2023 for its most recent financial year result. As path to profitability is the topic on Creo Medical Group's investors mind, we've decided to gauge market sentiment. Below we will provide a high-level summary of the industry analysts’ expectations for the company.
See our latest analysis for Creo Medical Group
Consensus from 3 of the British Medical Equipment analysts is that Creo Medical Group is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of UK£5.1m in 2026. So, the company is predicted to breakeven approximately 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 80% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Given this is a high-level overview, we won’t go into details of Creo Medical Group's upcoming projects, though, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 12% 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:
There are too many aspects of Creo Medical Group to cover in one brief article, but the key fundamentals for the company can all be found in one place – Creo Medical Group's company page on Simply Wall St. We've also put together a list of relevant factors you should further research:
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Valuation: What is Creo Medical Group 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 Creo Medical Group is currently mispriced by the market.
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Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Creo Medical Group’s board and the CEO’s background.
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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.