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Immutep Limited's (ASX:IMM): Immutep Limited, a biotechnology company, engages in the research, development, and commercialization of biological products. With the latest financial year loss of -AU$18.3m and a trailing-twelve month of -AU$15.6m, the AU$59m market-cap alleviates its loss by moving closer towards its target of breakeven. The most pressing concern for investors is IMM’s path to profitability – when will it breakeven? I’ve put together a brief outline of industry analyst expectations for IMM, its year of breakeven and its implied growth rate.
See our latest analysis for Immutep
Expectation from Biotechs analysts is IMM is on the verge of breakeven. They anticipate the company to incur a final loss in 2020, before generating positive profits of AU$4.4m in 2021. Therefore, IMM is expected to breakeven roughly a couple of months from now! How fast will IMM have to grow each year in order to reach the breakeven point by 2021? Working backwards from analyst estimates, it turns out that they expect the company to grow 78% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, IMM may become profitable much later than analysts predict.
I’m not going to go through company-specific developments for IMM given that this is a high-level summary, though, take into account that generally biotechs, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
One thing I’d like to point out is that IMM has managed its capital judiciously, with debt making up 29% of equity. This means that IMM 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 IMM to cover in one brief article, but the key fundamentals for the company can all be found in one place – IMM’s company page on Simply Wall St. I’ve also compiled a list of relevant factors you should look at:
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Historical Track Record: What has IMM's 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.
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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 Immutep’s board and the CEO’s back ground.
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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.
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.
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