We feel now is a pretty good time to analyse Apellis Pharmaceuticals, Inc.'s (NASDAQ:APLS) business as it appears the company may be on the cusp of a considerable accomplishment. Apellis Pharmaceuticals, Inc., a commercial-stage biopharmaceutical company, focuses on the discovery, development, and commercialization of therapeutic compounds through the inhibition of the complement system for autoimmune and inflammatory diseases. The US$4.9b market-cap company posted a loss in its most recent financial year of US$529m and a latest trailing-twelve-month loss of US$333m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Apellis Pharmaceuticals will turn a profit, with the big question being "when will the company 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 17 of the American Biotechs analysts is that Apellis Pharmaceuticals is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of US$22m in 2025. Therefore, the company is expected to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 68% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Apellis Pharmaceuticals' growth isn't the focus of this broad overview, however, bear in mind that by and large biotechs, depending on the stage of product development, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

One thing we would like to bring into light with Apellis Pharmaceuticals is its debt-to-equity ratio of 173%. Typically, debt shouldn't exceed 40% of your equity, and the company has considerably exceeded this. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.

Next Steps:

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

1. Valuation: What is Apellis Pharmaceuticals 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 Apellis Pharmaceuticals 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 Apellis Pharmaceuticals'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.