BHC - Embedded Expectations Analysis - 2019 12 11
Bausch Health Companies Inc. (BHC:USA) currently trades well below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 13.0x Uniform P/E. At these levels, markets are pricing in muted expectations for the firm, and while management may be concerned about their Ortho Derm segment, EBITDA, and gross margin, the firm's positioning suggests longer-term upside may remain warranted.Specifically, management may lack confidence in their ability to drive revenue growth through new product launches and further develop their existing business. Furthermore, they may be concerned about their ability to sustain market share gains with the SiHy product, and about further revenue contraction in their Ortho Derm segment. In addition, they may lack confidence in their ability to meet their revenue CAGR guidance on a 3-year basis and meet their gross margin guidance for 2019. Finally, they may lack confidence in their ability to sustain recent EBITDA improvement, and they may be concerned about the growth potential of their B+L segment.
Valeant Pharmaceuticals International is a pharmaceutical and medical device company that develops, manufactures, and markets a range of branded, generic and branded generic pharmaceuticals, over-the-counter (OTC) products, and medical devices (contact lenses, intraocular lenses, ophthalmic surgical equipment, and aesthetics devices). Co. has two operating and reportable segments: Developed Markets, which focuses in dermatology, neurology, gastrointestinal disorders, and eye health therapeutic; and Emerging Markets, which focuses primarily on branded generics, OTC products, and medical devices.
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