Is Bausch + Lomb (BLCO) the Best Medical Stock to Buy Under $20?

Bausch + Lomb (BLCO) has been making waves in the medical sector, with its stock price currently hovering around $17.76. But the question remains: is it the best medical stock to buy under $20? Let's dive into the data and expert opinions to find out.

Analyst Consensus: Buy

The average analyst rating for Bausch + Lomb stock from 12 stock analysts is "Buy," indicating that analysts believe this stock is likely to outperform the market over the next twelve months. The average price target is $20.91, which represents a 17.74% increase from the current stock price of $17.76.

Revenue Growth

Bausch + Lomb's revenue grew 18% as reported and 19% on a constant currency basis in the fourth quarter of 2023 compared to the same period in 2022. This growth was driven by growth across all segments. For the full year 2023, revenue grew 10% as reported and 12% on a constant currency basis compared to the full year of 2022.



Quality of Growth

The company's revenue growth is not only impressive but also of high quality, setting it apart from others in the industry. This is evident in the strong performance of its segments, with Vision Care, Pharmaceuticals, and Surgical all contributing to the overall growth.

Strategic Collaborations

Bausch + Lomb has announced strategic collaborations with other companies, such as City Therapeutics, Inc., to develop novel treatments for eye conditions like geographic atrophy. These collaborations can lead to innovative products and expanded market reach, further driving the company's growth.

Undervalued Stock Price

Despite the strong growth and positive analyst sentiment, Bausch + Lomb's stock price remains relatively low, presenting an opportunity for investors to buy in at an attractive price. With a current price of $17.76, the stock is trading at a significant discount to its average price target of $20.91.

Financial Performance vs. Peers

Bausch + Lomb's financial performance in 2023 was strong, with revenue growing 10% as reported and 12% on a constant currency basis compared to the full year of 2022. The company's adjusted EBITDA (non-GAAP) also increased significantly during this period. Compared to its peers in the medical sector, Bausch + Lomb's average target price and spread are in line with the sector average, and the company is well-covered by analysts.

Product Pipeline

Bausch + Lomb's product pipeline plays a significant role in its long-term growth potential. The company has a robust pipeline of innovative products that are expected to drive revenue growth in the coming years. For instance, in the fourth quarter of 2023, the company launched enVista® Aspire monofocal and enVista® Envy™ full visual range intraocular lenses, which are expected to contribute to the company's growth. Additionally, the company has a strong pipeline of products in development, including novel therapies for geographic atrophy and other eye diseases. These products have the potential to generate significant revenue for the company and solidify its position as a leader in the eye health industry.

In conclusion, Bausch + Lomb's strong analyst consensus, impressive revenue growth, high-quality growth, strategic collaborations, undervalued stock price, and robust product pipeline make it an attractive investment under $20. The company's financial performance also compares favorably to its peers in the medical sector. As such, Bausch + Lomb is a compelling choice for investors seeking exposure to the medical sector at an attractive price point.