Digirad Corporation's (NASDAQ:DRAD) Path To Profitability
With the business potentially at an important milestone, we thought we'd take a closer look at the future prospects of Digirad Corporation (NASDAQ: DRAD). Digirad Corporation provides healthcare solutions in the US and internationally. The company's loss has recently widened since it announced a full fiscal year loss of $ 5.5 million, compared to its most recent twelve-month loss of $ 8.2 million, which is further from breakeven. The most pressing concern for investors is Digirad's path to profitability - when will it break even? In this article, we're going to look at expectations for the company's growth and when analysts expect it to become profitable.
Check out our latest analysis for Digirad
Two of the American Healthcare analysts agree that Digirad is about to break even. They anticipate the company will suffer a final loss in 2021 before turning a positive profit of $ 1.4 million in 2022. The company is therefore expected to break even in about two years. In order to meet this breakeven date, we calculated the company's growth rate compared to the previous year. An average annual growth rate of 101% is expected, which signals a high level of confidence among analysts. Should the business grow more slowly, it will become profitable later than expected.
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The underlying developments that are driving Digirad's growth are not the focus of this comprehensive overview. However, keep in mind that a high rate of growth is generally not uncommon, especially when a company is in an investment phase.
One thing we want to bring to light with Digirad is the relatively high level of debt. As a general rule of thumb, debt shouldn't exceed 40% of your equity, which in Digirad's case is 58%. Note that a higher debt obligation increases the risk of investing in the losing company.
There are too many aspects of Digirad to cover in one short article, but you can find the essentials for the business all in one place - Digirad's company page on Simply Wall Street. We have also compiled a list of the key aspects that you should research further:
Evaluation: What is Digirad worth today? Has the future growth potential been taken into account in the price? The intrinsic value infographic in our free research report helps illustrate whether Digirad is currently mispriced by the market.
Management team: An experienced management team at the top strengthens our confidence in the business. See who sits on Digirad's board of directors and what their CEO's background is.
Other High Performing Stocks: Are there any other stocks that offer better prospects with proven success? Discover our free list of these great stocks here.
This article from Simply Wall St is of a general nature. It is not a recommendation to buy or sell stocks and does not take into account your goals or your financial situation. We want to provide you with a long-term, focused analysis based on fundamental data. Note that our analysis may not take into account the latest price sensitive company announcements or quality materials. Simply Wall St has no position in the stocks mentioned.
Do you have any feedback on this article? Concerned about the content? Contact us. Alternatively, you can also send an email to the editorial team (at) simplywallst.com.
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