We feel now is a pretty good time to analyse Heron Therapeutics, Inc.'s (NASDAQ:HRTX) business as it appears the company may be on the cusp of a considerable accomplishment. Heron Therapeutics, Inc., a biotechnology company, engages in developing treatments to address unmet patient needs. The US$377m market-cap company posted a loss in its most recent financial year of US$182m and a latest trailing-twelve-month loss of US$120m shrinking the gap between loss and breakeven. As path to profitability is the topic on Heron Therapeutics' 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.

Heron Therapeutics is bordering on breakeven, according to the 3 American Biotechs analysts. They expect the company to post a final loss in 2025, before turning a profit of US$14m in 2026. The company is therefore projected to breakeven around 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 59% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won't go into details of Heron Therapeutics' upcoming projects, though, keep in mind that generally a biotech has lumpy cash flows which are contingent on the product type and stage of development the company is in. So, 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 issue worth mentioning. Heron Therapeutics currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

There are key fundamentals of Heron Therapeutics which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Heron Therapeutics, take a look at Heron Therapeutics' company page on Simply Wall St. We've also compiled a list of important factors you should look at:

1. Valuation: What is Heron Therapeutics 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 Heron Therapeutics 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 Heron Therapeutics'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.

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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.