BHC - Embedded Expectations Analysis - 2021 03 19
Bausch Health Companies Inc. (BHC:USA) currently trades well below corporate averages relative to UAFRS-based (Uniform) earnings, with an 11.3x Uniform P/E, implying bearish expectations for the firm. However, although management appears concerned about the Bausch + Lomb spinoff, their R&D pipeline, and new product launches, market expectations are overly bearish, and longer-term equity outperformance is warrantedSpecifically, management may have concerns about the impact of potential divestitures, the strength of their R&D pipeline, and the ability of their businesses to recover from the impacts of the pandemic. In addition, they may lack confidence in their ability to pay off their target debt in 2021, efficiently complete the internal objectives necessary for the Bausch + Lomb (B&L) spinoff, and improve their EBITDA. Furthermore, they may be overstating the potential of their ULTRA ONE DAY and Silicon Hydrogen (SiHy) Daily Lenses launches and the opportunity to unlock shareholder value from the B&L spinoff
Although management appears concerned about the Bausch + Lomb spinoff, their R&D pipeline, and new product launches, market expectations are overly bearish given the firm's overblown market concerns. As such, longer-term equity outperformance is warranted for BHC
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.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.