Bausch & Lomb stock target cut to $15 at H.C. Wainwright

Published 02/05/2025, 13:14
Bausch & Lomb stock target cut to $15 at H.C. Wainwright

On Friday, H.C. Wainwright analyst Yi Chen adjusted the price target for Bausch & Lomb Corp. (NYSE:BLCO) to $15.00, down from the previous $20.00, while maintaining a Buy rating on the stock. The revision follows the company’s first-quarter financial report earlier in the week, which showed total revenue of $1,137 million. This marked a 3.5% year-over-year increase but fell short of the anticipated $1,150 million. The company maintains a solid gross profit margin of 61%, though InvestingPro analysis indicates it operates with a significant debt burden of nearly $5 billion.

The company experienced a net loss of $212 million, or $0.60 per share, which was significantly higher than the estimated loss of $59 million. The adjusted net loss stood at $54 million, or $0.15 per share, which was below the projected income of $53 million. Bausch & Lomb’s management highlighted that on a constant currency basis, revenue growth was 5%, but foreign exchange fluctuations negatively affected the results by $19 million.

The earnings report also included the financial impact of the enVista recall, which is estimated to have reduced revenue by approximately $55 million and adjusted EBITDA by about $65 million. The updated guidance provided by the company does not take into account the potential effects of tariffs. While currently trading near its InvestingPro Fair Value, the company maintains a "Fair" overall financial health score. Get detailed insights and 7 additional ProTips with a comprehensive Pro Research Report, available exclusively on InvestingPro.

Chen noted the lowered valuation multiples are a reflection of the uncertainties surrounding tariffs, leading to the reduced price target. Despite the cut in the price target, the analyst reiterated a Buy rating for Bausch & Lomb, indicating a continued positive outlook on the stock’s performance over the next 12 months.

In other recent news, Bausch + Lomb Corp reported its Q1 2025 earnings, revealing a miss on both earnings per share (EPS) and revenue forecasts. The company posted an EPS of -$0.07 against a forecast of $0.02, and actual revenue of $1.14 billion compared to the expected $1.15 billion. Despite these setbacks, Bausch + Lomb raised its full-year revenue guidance to a range of $5.0 to $5.1 billion. The company experienced a 5% growth in revenue on a constant currency basis, driven by strong performance in its contact lens and eye health product segments. A voluntary recall of Envista lenses impacted revenue by $55 million, posing a risk to short-term financial performance. Analyst notes highlighted the company’s strategic initiatives, including the anticipated approval of the Elios MIGS glaucoma product by year-end. Bausch + Lomb’s core business continues to perform well, with expectations of constant currency revenue growth for the year. The company remains focused on innovation and expansion in its product offerings.

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