On Monday, Bausch & Lomb Corp. (NYSE:BLCO) received an upgrade in stock rating from Morgan Stanley (NYSE:MS), moving from Equal-weight to Overweight. Accompanying this upgrade, the firm also raised the price target for the company's shares to $18.00 from the previous $16.00.
Morgan Stanley's decision is based on the assessment that Bausch & Lomb's core business is performing better than the market expects, particularly in terms of margin execution. Additionally, the firm sees potential for higher organic top-line growth, driven by the company's MIEBO treatment and its product pipeline.
The analyst from Morgan Stanley believes there is a 15-20% upside risk to the street's 2025 Earnings Per Share (EPS) estimates for Bausch & Lomb. This anticipated improvement in growth prospects has been a key factor in the decision to raise the company's stock rating.
The new price target of $18.00 represents a notable increase from the previous target, suggesting a stronger confidence in the company's financial performance going forward. Bausch & Lomb's advancements in its product development and market execution are key contributors to this optimistic outlook.
InvestingPro Insights
Following Morgan Stanley's optimistic revision of Bausch & Lomb Corp. (NYSE:BLCO), a glance at the InvestingPro data and tips provides a nuanced perspective on the company's current financial standing. With a market capitalization of $4.78 billion, BLCO shows a promising revenue growth of 13.23% in the last twelve months as of Q1 2024, indicating a robust expansion in its business activities. This is further supported by a gross profit margin of 60.73%, showcasing the company's ability to maintain profitability in its operations.
However, the InvestingPro Tips suggest a mixed sentiment. On the one hand, analysts expect net income growth this year, which aligns with Morgan Stanley's positive outlook. On the other hand, four analysts have revised their earnings downwards for the upcoming period, and the stock has been under pressure, trading near its 52-week low and experiencing significant price drops over the last week and month. This could indicate market skepticism about the company's short-term performance despite long-term growth prospects.
For investors seeking a more comprehensive analysis, there are additional InvestingPro Tips available for BLCO, which could provide deeper insights into the company's potential. To access these insights and enhance your investment strategy, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
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