We feel now is a pretty good time to analyse ChromaDex Corporation's (NASDAQ:CDXC) business as it appears the company may be on the cusp of a considerable accomplishment. ChromaDex Corporation operates as a bioscience company focusing on healthy aging. The company’s loss has recently broadened since it announced a US$20m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$23m, moving it further away from breakeven. As path to profitability is the topic on ChromaDex'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.
According to the 6 industry analysts covering ChromaDex, the consensus is that breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of US$9.7m in 2023. Therefore, the company is expected to breakeven roughly 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 76%, which signals high confidence from analysts. 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 ChromaDex given that this is a high-level summary, but, bear in mind that generally a life science company has lumpy cash flows which are contingent on the product and stage of development the company is in. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
One thing we’d like to point out is that ChromaDex has no debt on its balance sheet, which is quite unusual for a cash-burning life science company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
There are too many aspects of ChromaDex to cover in one brief article, but the key fundamentals for the company can all be found in one place – ChromaDex's company page on Simply Wall St. We've also put together a list of essential factors you should further research:
Valuation: What is ChromaDex 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 ChromaDex is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on ChromaDex’s board and the CEO’s background.
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. 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.
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