Shares of
Bausch Health Companies Inc
.
BHC
are trading down in response to weak first-quarter 2022 results.
The stock has plunged 70.4% in the year so far compared with the
industry
’s decline of 30.4%.
Image Source: Zacks Investment Research
The company’s adjusted earnings per share of 72 cents missed the Zacks Consensus Estimate of $1.03 and decreased from $1.04 reported in the year-ago quarter.
Total revenues of $1.9 billion missed the Zacks Consensus Estimate of $2.1 billion and fell 5% year over year. Management stated that incremental macro pressures and a challenging supply chain environment affected the quarter.
Quarter in Detail
The company reported revenues in five segments – Salix, International, Diversified Products, Solta Medical and Bausch + Lomb.
Salix revenues came in at $464 million, down 2%. The decrease was primarily due to lower volumes on the loss of exclusivity of certain products, partially offset by increased sales of Xifaxan (rifaximin), Trulance (plecanatide) and Plenvu (polyethylene glycol 3350, sodium ascorbate, sodium sulfate, ascorbic acid, sodium chloride and potassium chloride for oral solution), which grew 1%, 14% and 60%, respectively year over year.
International Rx revenues in the quarter were $244 million, down 20%.
Diversified Products revenues were $249 million, down 16% from the year-ago quarter, primarily due to decreased volumes.
Solta Medical reported revenues of $72 million, flat year over year, as an increase in net realized pricing was offset by a decline in volumes primarily due to inventory shortfalls resulting from the impact of lockdowns in China due to the new COVID-19 variant and microchip supply chain constraints.
Revenues from Bausch + Lomb were $889 million, up 1% year over year. Excluding the unfavorable impact of $29 million from foreign exchange and the impact of divestitures and discontinuations of $3 million, revenues increased organically by 5%, primarily due to higher sales in the global Vision Care business, including Lumify (brimonidine tartrate ophthalmic solution 0.025%), Biotrue Multi-Purpose Solution and Ocuvite/PreserVision and higher sales in the Global Surgical business.
Bausch Health Cos Inc. Price, Consensus and EPS Surprise
Bausch Health Cos Inc. price-consensus-eps-surprise-chart
|
Bausch Health Cos Inc. Quote
2022 Guidance Updated
Revenues are now expected in the $8.25-$8.40 billion range (earlier projection: $8.40-$8.60 billion).
Initial Public Offering of Bausch + Lomb
Bausch Health’s eye health business, Bausch + Lomb, launched its initial public offering (IPO) and subsequently began trading under the ticker “BLCO” on May 6, 2022. The IPO is expected to close later in the day. The company expects to close the IPO with $630 million in gross proceeds to be applied for the repayment of Bausch Health’s long-term debt on May 10, 2022.
Following the close of the IPO of the Bausch + Lomb eye health business, Bausch Health will operate as two companies.
The company has also planned to separate its Solta business.
Pipeline Progress
The company launched Xipere (triamcinolone acetonide injectable suspension), which uses the suprachoroidal space to treat patients suffering from macular edema associated with uveitis in the United States during the current quarter.
Enrollment is ongoing in the phase III study of rifaximin soluble solid dispersion to study the use of rifaximin to prevent hepatic encephalopathy. The company initiated phase II study to evaluate amiselimod (S1P modulator) for the treatment of mild to moderate ulcerative colitis.
Our Take
Bausch’s first-quarter results were dismal amid incremental macro pressures and a challenging supply chain environment.
Zacks Rank & Stocks to Consider
Bausch currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the healthcare space are
Abeona Therapeutics
ABEO
,
Alkermes
ALKS
and
Sarepta Therapeutics
SRPT
. While Alkermes sports a Zacks Rank #1 (Strong Buy) at present, the other stocks carry a Zacks Rank #2 (Buy). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
Abeona Therapeutics’ loss per share estimates for 2022 have narrowed from 34 cents to 33 cents in the past 30 days. Shares of ABEO have declined 54.2% in the year-to-date period.
Abeona Therapeutics has a mixed surprise history. Its earnings surpassed expectations in one of the trailing four quarters, missing the mark in another and meeting the same in the remaining two occasions, the average surprise being 0.7%. In the last reported quarter, Abeona Therapeutics missed earnings estimates by 7.7%.
Alkermes’ loss per share estimates for 2022 have narrowed from 14 cents to 3 cents in the past 30 days. Shares of ALKS have risen 18.2% in the year-to-date period.
Earnings of Alkermes beat estimates in each of the last four quarters, the average being 350.5%.
Sarepta’s loss per share estimates for 2022 have narrowed by 28 cents in the past seven days. SRPT’s earnings having surpassed expectations in all of the trailing four quarters, the average surprise being 21.45%.
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