Bausch Health Companies Inc

.

BHC

is scheduled to report fourth-quarter and full-year 2021 results on Feb 23, before market open.

In the last reported quarter, the company’s earnings beat estimates by 6.54%. Bausch’s earnings track record has been excellent so far. The company beat earnings expectations in each of the last four quarters, the average surprise being 9.51%.

Bausch’s stock has lost 24.4% in the year so far compared with a 37.5% decline for the

industry

.

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Factors at Play

Bausch conducts business in the following reportable segments (i) Bausch + Lomb, (ii) Salix, (iii) International Rx, (iv)Ortho  Dermatologics  and  (v)  Diversified  Products.

Bausch + Lomb segment generated revenues of $949 million in the third quarter of 2021, an increase of 4%. Excluding the favorable impact of foreign exchange and divestitures and discontinuations, revenues increased organically 3% due to higher sales resulting from the positive effects of the recovery from the COVID-19 pandemic.  Leading brands performed well, and the momentum is likely to have continued in the fourth quarter.

We note that Bausch + Lomb Corporation is going public in the United States and Canada. It has filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission. The move relates to the company’s previously announced intention to separate its eye health business.

Salix segment revenues were up 6% in the third quarter driven by higher sales resulting from the positive impacts of the recovery from the COVID-19 pandemic, including sales of Xifaxan, Relistor, (methylnaltrexone bromide) and Trulance (plecanatide), which grew 12%, 14% and 14%, respectively, year over year. The trend is likely to have continued in the fourth quarter.  Management continues to see steady recovery for Xifaxan prescriptions within the long-term care channel, and sales are expected to have recovered in the fourth quarter.

International Rx segment revenues were down 12% in the third quarter. Similar levels of decline might have been registered in the fourth quarter.

Ortho Dermatologics segment revenues were down 2%, and the trend is likely to have continued in the fourth quarter.

The Diversified Products segment reported a decline of 19% in the third quarter due to a decrease in volumes and net realized pricing. Similar levels of decline are likely to have been recorded in the fourth quarter.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Bausch this time around. The combination of a positive

Earnings ESP

and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here, as you will see below. You can uncover the best stocks to buy or sell before they’re reported with our

Earnings ESP Filter

.

Earnings ESP


: Earnings ESP for Bausch is -2.78%. This is because the Zacks Consensus Estimate stands at $1.08 and the Most Accurate Estimate at $1.05.

Zacks Rank


: Bausch carries a Zacks Rank #3.

Stocks to Consider

Here are some companies you may consider, as our model shows that these have the right combination of elements to deliver an earnings beat this reporting cycle.

Vir Biotechnology


VIR

has an Earnings ESP of +32.05% and a Zacks Rank #1. You can see

the complete list of today’s Zacks #1 Rank stocks here

.

Earnings per share estimates of Vir Biotechnology for 2022 have increased $6.52. Vir Biotechnology topped earnings estimates in two of the last four quarters and missed the mark on the other two occasions, delivering a surprise of 13%, on average.

Viatris


VTRS

has an Earnings ESP of +2.19% and a Zacks Rank #3.

Viatris topped earnings estimates in the last three quarters delivering a surprise of 14.31%, on average.  Shares of VTRS are up 8.7% in the year so far.

Emergent Biosolutions


EBS

has an Earnings ESP of +18.40% and a Zacks Rank #3.

Earnings per share estimates of EBS for 2022 have increased to $3.12 from $3.09 in the last seven days.

Stay on top of upcoming earnings announcements with the

Zacks Earnings Calendar

.

5 Stocks Set to Double

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