LifeMD, Inc. (NASDAQ:LFMD): When Will It Breakeven?

We feel now is a pretty good time to analyse LifeMD, Inc.’s (NASDAQ:LFMD) business as it appears the company may be on the cusp of a considerable accomplishment. LifeMD, Inc. operates as a direct-to-patient telehealth company that connects consumers to healthcare professionals for medical care in the United States. The company’s loss has recently broadened since it announced a US$24m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$26m, moving it further away from breakeven. The most pressing concern for investors is LifeMD’s path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for LifeMD

According to the 6 industry analysts covering LifeMD, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of US$3.8m in 2025. Therefore, the company is expected 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 126%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth

We’re not going to go through company-specific developments for LifeMD given that this is a high-level summary, however, keep in mind that generally a healthcare tech company has lumpy cash flows which are contingent on the product and stage of development the company is in. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.

Before we wrap up, there’s one issue worth mentioning. LifeMD currently has a debt-to-equity ratio of over 2x. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on LifeMD, so if you are interested in understanding the company at a deeper level, take a look at LifeMD’s company page on Simply Wall St. We’ve also put together a list of important aspects you should further examine:

  1. Valuation: What is LifeMD 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 LifeMD 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 LifeMD’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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

This article was originally published here.