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On Friday, RBC Capital Markets adjusted its price target for Bausch & Lomb Corporation (NYSE:BLCO) shares, reducing it to $17.00 from the previous $18.00, while still holding an Outperform rating on the stock. The firm’s analyst Douglas Miehm provided insights ahead of the company’s first-quarter earnings report scheduled for April 30, 2025, before market open.
Miehm anticipates Bausch & Lomb will post Q1 revenue of approximately $1,150 million, aligning with consensus estimates, and adjusted EBITDA of $161 million, which is slightly below the consensus of $163 million. The analyst expects the company’s prescription drugs for dry eye disease, Miebo and Xiidra, to be a focal point, along with the recent intraocular lens (IOL) recall and its resolution timeline. Additionally, potential headwinds from tariffs following new reciprocal tariffs announced by the United States are also on the radar.
The firm notes that foreign exchange (FX) headwinds, which have been a factor in the past, appear to have moderated. RBC Capital estimates a $24 million FX impact for Q1 and has adjusted the full-year 2025 forecast to $45 million based on current exchange rates, a decrease from the $100 million previously projected.
The revised price target to $17 from $18 is attributed to updated estimates and multiples, reflecting the latest FX movements within the quarter that have shown moderation. Moreover, the analyst pointed out that the updated prescription trends for Miebo and Xiidra, as tracked by IQVIA, have outperformed the firm’s initial estimates. However, these positive aspects are somewhat counterbalanced by challenges faced in Bausch & Lomb’s Surgical segment.
Investors will be watching closely as Bausch & Lomb reports its first-quarter results at the end of April, which will provide further clarity on the company’s performance and the impact of the various factors highlighted by RBC Capital Markets.
In other recent news, Bausch & Lomb Corporation has been at the center of multiple analyst reviews and corporate developments. Stifel analysts have adjusted their outlook, lowering the price target to $15 while maintaining a Hold rating, following a survey indicating a potential positive reception to the company’s recalled intraocular lenses once they return to the market. Wells Fargo (NYSE:WFC) has also downgraded Bausch & Lomb from Overweight to Equal Weight, citing uncertainties around the enVista intraocular lens recall, and reduced its price target from $24 to $15. Additionally, Morgan Stanley (NYSE:MS) has revised its price target from $19 to $18, maintaining an Equalweight rating, as they anticipate increased operating expenses despite expected revenue growth.
The recall of enVista lenses has prompted a proactive response from Bausch & Lomb, with the company communicating with eye care professionals about the issue. This recall has been a significant concern, as it involves complications potentially linked to toxic anterior segment syndrome. Despite these challenges, S&P Global Ratings has upgraded Bausch & Lomb’s credit rating from ’B-’ to ’B’, reflecting a more positive view of the company’s creditworthiness.
Investors are keeping a close eye on how Bausch & Lomb manages these developments, particularly the resolution of the enVista recall and its impact on financial performance. The company’s focus on new product launches, such as Miebo and ENVY, is seen as a critical component of its growth strategy. The ongoing evaluations by analysts underscore the mixed sentiment surrounding the company’s future prospects amid these recent events.
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