Total Brain Limited (ASX:TTB) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Total Brain Limited, together with its subsidiaries, develops and sells brain health products in the United States and Australia. With the latest financial year loss of AU$8.3m and a trailing-twelve-month loss of AU$6.8m, the AU$13m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Total Brain will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Check out our latest analysis for Total Brain
Total Brain is bordering on breakeven, according to some Australian Healthcare analysts. They expect the company to post a final loss in 2023, before turning a profit of AU$1.0m in 2024. The company is therefore projected to breakeven around 2 years from now. 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 97% 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.
We're not going to go through company-specific developments for Total Brain given that this is a high-level summary, however, bear in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 22% 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 Total Brain to cover in one brief article, but the key fundamentals for the company can all be found in one place – Total Brain's company page on Simply Wall St. We've also compiled a list of key factors you should further research:
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Valuation: What is Total Brain 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 Total Brain 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 Total Brain’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.