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We feel now is a pretty good time to analyse Cytosorbents Corporation's (NASDAQ:CTSO) business as it appears the company may be on the cusp of a considerable accomplishment. Cytosorbents Corporation, a critical care focused immunotherapy company, engages in the research, development, and commercialization of medical devices with its blood purification technology platform incorporating a proprietary adsorbent and porous polymer technology. The US$365m market-cap company posted a loss in its most recent financial year of US$7.8m and a latest trailing-twelve-month loss of US$8.6m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is Cytosorbents' path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
See our latest analysis for Cytosorbents
According to the 6 industry analysts covering Cytosorbents, the consensus is that breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of US$13m in 2023. So, the company is predicted to breakeven approximately 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 75% 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.
Given this is a high-level overview, we won’t go into details of Cytosorbents' upcoming projects, however, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
Before we wrap up, there’s one aspect worth mentioning. Cytosorbents currently has no debt on its balance sheet, which is rare for a loss-making growth company, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on Cytosorbents, so if you are interested in understanding the company at a deeper level, take a look at Cytosorbents' company page on Simply Wall St. We've also compiled a list of pertinent aspects you should further research:
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Valuation: What is Cytosorbents 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 Cytosorbents 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 Cytosorbents’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.
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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