CA - Bausch + Lomb Corporation: Spin-Off Ready To Fly Troubled Nest And Find Upside

2024-05-22 16:31:48 ET

Summary

• Bausch + Lomb, a spin-off from Bausch Health, has shown solid performance with revenues of $4.1bn in 2023 and a narrowing net loss of $(260m).
• The company's Q1 2024 report shows growth in all segments, including Vision Care, Surgical, and Pharmaceuticals.
• Bausch + Lomb's CEO, the veteran Pharma dealmaker Brent Saunders, has praised the performance of the existing business and hinted at a focus on existing products and targeting growth.
• While parent company Bausch Health's share price is volatile and dictated by battles with generic drug makers, the spinout's progress seems comparatively serene.
• I can see CEO Saunders finding a way to complete a difficult spinout from the parent, which still holds over 80% of B+L stock, and if this can be done, the case for upside is clear.

Investment Overview - Unpicking A Tangled Web Of Deals, Dealmakers, and Spin-outs

In July last year, I provided some deep dive coverage of Bausch + Lomb Corporation ( BLCO ), and its parent company Bausch Health ( BHC ). The story of the spin out - and its logic - takes some explaining, and I will refer readers to my previous note for a fuller background explanation....

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