In This Article:
RUA Life Sciences plc (LON:RUA) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. RUA Life Sciences plc, together with its subsidiaries, engages in the provision of polymers, services, and products to the medical device industry in Europe, the United States, and internationally. The UK£7.0m market-cap company announced a latest loss of UK£1.4m on 31 March 2024 for its most recent financial year result. The most pressing concern for investors is RUA Life Sciences' path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.
See our latest analysis for RUA Life Sciences
Expectations from some of the British Medical Equipment analysts is that RUA Life Sciences is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of UK£435k in 2026. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 98% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Underlying developments driving RUA Life Sciences' growth isn’t the focus of this broad overview, but, keep in mind that by and large 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 prudently, with debt making up 2.3% 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 key fundamentals of RUA Life Sciences which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at RUA Life Sciences, take a look at RUA Life Sciences' company page on Simply Wall St. We've also put together a list of pertinent factors you should further research:
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Valuation: What is RUA Life Sciences 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 RUA Life Sciences 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 RUA Life Sciences’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.