Botanix Pharmaceuticals Limited (ASX:BOT) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Botanix Pharmaceuticals Limited engages in the research and development of dermatology and antimicrobial products in Australia and the United States. The company’s loss has recently broadened since it announced a AU$14m loss in the full financial year, compared to the latest trailing-twelve-month loss of AU$39m, moving it further away from breakeven. As path to profitability is the topic on Botanix Pharmaceuticals' 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.

View our latest analysis for Botanix Pharmaceuticals

Botanix Pharmaceuticals is bordering on breakeven, according to some Australian Pharmaceuticals analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of AU$3.7m in 2025. Therefore, the company is expected to breakeven roughly 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 119% year-on-year, on average, which is extremely buoyant. 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 Botanix Pharmaceuticals given that this is a high-level summary, but, bear in mind that typically a pharma company has lumpy cash flows which are contingent on the drug and stage of product development the business is in. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that Botanix Pharmaceuticals has no debt on its balance sheet, which is quite unusual for a cash-burning pharma, which typically has high 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.

Next Steps:

This article is not intended to be a comprehensive analysis on Botanix Pharmaceuticals, so if you are interested in understanding the company at a deeper level, take a look at Botanix Pharmaceuticals' company page on Simply Wall St. We've also compiled a list of key aspects you should look at:

1. Valuation: What is Botanix Pharmaceuticals 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 Botanix Pharmaceuticals is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Botanix Pharmaceuticals’s board and the CEO’s background.
3. 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.

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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.