With the business potentially at an important milestone, we thought we'd take a closer look at scPharmaceuticals Inc.'s (NASDAQ:SCPH) future prospects. scPharmaceuticals Inc., a pharmaceutical company, engages in the development and commercialization of various pharmaceutical products. The US$192m market-cap company posted a loss in its most recent financial year of US$37m and a latest trailing-twelve-month loss of US$50m leading to an even wider gap between loss and breakeven. As path to profitability is the topic on scPharmaceuticals' 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 scPharmaceuticals

According to the 6 industry analysts covering scPharmaceuticals, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$44m in 2026. Therefore, the company is expected to breakeven roughly 2 years 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 57%, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for scPharmaceuticals given that this is a high-level summary, however, bear in mind that generally pharmaceuticals, 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 would like to bring into light with scPharmaceuticals is its relatively high level of debt. Generally, the rule of thumb is debt shouldn't exceed 40% of your equity, which in scPharmaceuticals' case is 78%. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of scPharmaceuticals to cover in one brief article, but the key fundamentals for the company can all be found in one place – scPharmaceuticals' company page on Simply Wall St. We've also put together a list of key factors you should further examine:

1. Valuation: What is scPharmaceuticals 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 scPharmaceuticals 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 scPharmaceuticals'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.