With the business potentially at an important milestone, we thought we'd take a closer look at MeiraGTx Holdings plc's (NASDAQ:MGTX) future prospects. MeiraGTx Holdings plc, a clinical stage gene therapy company, focusing on developing treatments for patients with serious diseases. The US$321m market-cap company posted a loss in its most recent financial year of US$84m and a latest trailing-twelve-month loss of US$93m leading to an even wider gap between loss and breakeven. The most pressing concern for investors is MeiraGTx Holdings' 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.

View our latest analysis for MeiraGTx Holdings

Consensus from 3 of the American Biotechs analysts is that MeiraGTx Holdings is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of US$119m in 2025. So, the company is predicted to breakeven just over a year from today. 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 7.8%, which is relatively conservative. If this rate turns out to be too low, the company may become profitable faster than analysts expect.

Underlying developments driving MeiraGTx Holdings' growth isn’t the focus of this broad overview, but, take into account that by and large biotechs, depending on the stage of product development, have irregular periods of cash flow. This means that a low or volatile growth rate in the near future is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one issue worth mentioning. MeiraGTx Holdings currently has a relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in MeiraGTx Holdings' case is 91%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are key fundamentals of MeiraGTx Holdings 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 MeiraGTx Holdings, take a look at MeiraGTx Holdings' company page on Simply Wall St. We've also put together a list of essential aspects you should further examine:

1. Historical Track Record: What has MeiraGTx Holdings' performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.

2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on MeiraGTx Holdings' 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.