When Will GeneDx Holdings Corp. (NASDAQ:WGS) Turn A Profit?

GeneDx Holdings Corp Ordinary Shares - Class A -2.12%

GeneDx Holdings Corp Ordinary Shares - Class A

WGS

76.35

-2.12%

With the business potentially at an important milestone, we thought we'd take a closer look at GeneDx Holdings Corp.'s (NASDAQ:WGS) future prospects. GeneDx Holdings Corp., a genomics company, provides personalized and actionable health insights to inform diagnosis, direct treatment, and improve drug discovery. The US$2.2b market-cap company posted a loss in its most recent financial year of US$176m and a latest trailing-twelve-month loss of US$83m shrinking the gap between loss and breakeven. The most pressing concern for investors is GeneDx 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.

Consensus from 6 of the American Healthcare analysts is that GeneDx Holdings is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$15m in 2026. So, the company is predicted to breakeven just over a year from now. 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 94%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
NasdaqGS:WGS Earnings Per Share Growth January 6th 2025

We're not going to go through company-specific developments for GeneDx Holdings given that this is a high-level summary, though, bear in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 25% 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:

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

  1. Historical Track Record: What has GeneDx 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 GeneDx 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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