Yahoo Finance Bausch Health Companies Inc. Just Released Its Annual Results And Analysts Are Updating Their Estimates
Bausch Health Companies Inc. (NYSE:BHC) shares fell 4.5% to US$26.50 in the week since its latest full-year results. Revenues of US$8.6b arrived in line with expectations, although statutory losses per share were US$5.08, an impressive 422% smaller than what broker models predicted. Analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what analysts' statutory forecasts suggest is in store for next year.
View our latest analysis for Bausch Health Companies
Taking into account the latest results, Bausch Health Companies's 14 analysts currently expect revenues in 2020 to be US$8.74b, approximately in line with the last 12 months. Per-share statutory losses are expected to explode, reaching US$0.72 per share. Before this latest report, the consensus had been expecting revenues of US$8.78b and US$2.08 per share in losses. There was no real change to the revenue estimates, but analysts do seem more bullish on earnings, given the massive increase in earnings per share expectations following these results.
The average analyst price target held steady at US$33.89, seeming to indicate that business is performing in line with expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Bausch Health Companies, with the most bullish analyst valuing it at US$60.00 and the most bearish at US$21.00 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's also worth noting that the years of declining sales look to have come to an end, with the forecast for flat revenues next year. Historically, Bausch Health Companies's sales have shrunk approximately 2.8% annually over the past five years. Compare this against analyst estimates for the wider market, which suggest that (in aggregate) market revenues are expected to grow 5.3% next year. Although Bausch Health Companies's revenues are expected to improve, it seems that analysts are still expecting it to grow slower than the wider market.
The Bottom Line
The most important thing to note from these estimates is that the consensus increased its forecast losses next year, suggesting all may not be well at Bausch Health Companies. On the plus side, there were no major changes to revenue estimates; although analyst forecasts imply revenues will perform worse than the wider market. The consensus price target held steady at US$33.89, with the latest estimates not enough to have an impact on analysts' estimated valuations.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Bausch Health Companies analysts - going out to 2024, and you can see them free on our platform here.
It might also be worth considering whether Bausch Health Companies's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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