Dignitana AB (publ) (STO:DIGN) is close to breaking even

We think this is the perfect time to analyze Dignitana AB (publ) (STO:DIGN) the company, as it appears the company is on the cusp of a huge accomplishment. Dignitana AB (publ), a medical technology company, is engaged in the development, production and marketing of medical cooling devices in the United States and internationally. As of December 31, 2023, the company with a market capitalization of 145 million crowns recorded a loss of 17 million crowns for its most recent financial year. Investors' most pressing concern is Dignitana's path to profitability: When will it break even? We've put together a brief overview of industry analyst expectations for the company, its breakeven year, and its implied growth rate.

Check out our latest analysis for Dignitana

According to some industry analysts covering Dignitana, the break-even point is close. They predict that the company will make a final loss in 2023, before generating positive profits of 3.0 million kr in 2024. So the company should break even in about a year or less! How fast will the company need to grow to reach consensus forecasts that predict balance between 2024 and 2024? Looking back at the analysts' estimates, it turns out that they expect the company to grow by an average of 139% year-on-year, which shows a lot of confidence from the analysts. If this rate proves too aggressive, the company could become profitable much later than analysts predict.

The underlying developments driving Dignitana's growth are not the focus of this general overview, but consider that in general, a high forecast growth rate is not unusual for a company going through currently a period of investment.

Before we conclude, there is one issue worth mentioning. Dignitana currently has a debt ratio above 2x. As a general rule, debt should not exceed 40% of your equity, and the company has significantly exceeded this figure. Note that a higher debt security increases the risk of investing in a loss-making company.

Next steps:

There are too many aspects of Dignitana to cover in just one brief article, but the company's fundamentals can all be found in one place: Dignitana's company page on Simply Wall St. We also have compiled a list of important aspects that you should explore further. research:

1. Assessment: What is Dignitana worth today? Has future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Dignitana is currently mispriced.
2. Management team: An experienced management team at the helm increases our confidence in the company – take a look at who sits on the Dignitana board and the CEO's background.
3. Other high-performing stocks: Are there other actions offering better prospects and having proven their worth? Check out our free list of these great titles here.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to constitute financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your objectives or your financial situation. Our goal is to provide you with targeted, long-term analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.