BCAL Diagnostics Limited (ASX:BDX) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. BCAL Diagnostics Limited, a screening and diagnostic company, engages in developing a novel blood screening test to improve the diagnosis and monitoring of breast cancer. The AU$37m market-cap company announced a latest loss of AU$6.4m on 30 June 2024 for its most recent financial year result. As path to profitability is the topic on BCAL Diagnostics' investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

View our latest analysis for BCAL Diagnostics

BCAL Diagnostics is bordering on breakeven, according to some Australian Biotechs analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of AU$3.8m in 2026. Therefore, the company is expected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 91% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won’t go into details of BCAL Diagnostics' upcoming projects, though, bear in mind that generally biotechs, depending on the stage of product development, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 7.5% 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.

Next Steps:

There are key fundamentals of BCAL Diagnostics 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 BCAL Diagnostics, take a look at BCAL Diagnostics' company page on Simply Wall St. We've also put together a list of pertinent aspects you should further research:

1. Valuation: What is BCAL Diagnostics 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 BCAL Diagnostics 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 BCAL Diagnostics’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.