We feel now is a pretty good time to analyse CureVac N.V.'s (NASDAQ:CVAC) business as it appears the company may be on the cusp of a considerable accomplishment. CureVac N.V., a clinical-stage biopharmaceutical company, focuses on developing various transformative medicines based on messenger ribonucleic acid (mRNA). On 31 December 2020, the US$21b market-cap company posted a loss of €129m for its most recent financial year. As path to profitability is the topic on CureVac's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Consensus from 5 of the American Biotechs analysts is that CureVac is on the verge of breakeven. They anticipate the company to incur a final loss in 2020, before generating positive profits of €341m in 2021. Therefore, the company is expected to breakeven roughly a year from now or less! At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 52%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.NasdaqGM:CVAC Earnings Per Share Growth July 18th 2021
We're not going to go through company-specific developments for CureVac given that this is a high-level summary, though, bear in mind that by and large a biotech has lumpy cash flows which are contingent on the product type 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.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 3.5% 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.
There are too many aspects of CureVac to cover in one brief article, but the key fundamentals for the company can all be found in one place – CureVac's company page on Simply Wall St. We've also compiled a list of important factors you should look at:
- Valuation: What is CureVac 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 CureVac 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 CureVac’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. 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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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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