On Monday, Citi reaffirmed its Buy rating on shares of Alcon Inc. (NYSE:ALC), maintaining a price target of $116.00. The decision followed an evaluation of the company's second-quarter results and updates from industry peers. Adjustments were made to Alcon's 2024 organic sales growth forecast, with a slight decrease due to reduced expectations for consumables and vision care. However, this was partially balanced by a stronger outlook for implantables.
The forecast for organic growth from 2025 onwards remains untouched. Consequently, the net sales predictions from 2024 to 2028 are virtually unchanged. A modest reduction of around 2% was applied to the 2024 core EBIT estimate, primarily due to an inventory provision recorded in the second quarter of 2024. Minor adjustments were also made to EBIT forecasts beyond 2024, resulting in less than a 1% change.
These revisions have led to a 1% decrease in the estimated earnings per share (EPS) for 2024, while the EPS forecast from 2025 and beyond remains the same. Citi's valuation of Alcon continues to be based on a 26 times price-to-earnings (P/E) ratio estimated for 2027, which is then discounted back to mid-2025 to establish the price target.
Citi's analysis concludes with a reaffirmation of Alcon's stock as one of the most attractive investment opportunities within their coverage area. Despite the adjustments to sales growth and core EBIT predictions for 2024, the firm's long-term outlook on the company remains positive, with the price target staying firm at $116.00.
In other recent news, Alcon Inc. has been maintaining a strong performance, with second-quarter sales in 2024 increasing by 6% to $2.5 billion, driven by a 9% growth in implantable sales. Despite facing challenges such as higher inventory provisions in its Vision Care segment and currency headwinds, the company managed to surpass earnings per share expectations.
CFRA, a financial research firm, has reiterated its Buy rating on Alcon stock, citing the company's growth momentum and new product launches, including AR-15152 for the treatment of dry eye.
Furthermore, Alcon's core diluted earnings per share rose by 15% from the previous year, reaching $0.74. The company anticipates a 15% to 18% growth in core diluted earnings over 2023. Despite a minor decline of 1% in equipment sales, a 9% increase in contact lens sales contributed to the 2% boost in Ocular Health sales.
The company's recent strategic moves, such as the clearance of the Unity Phaco platform by the US FDA, the acquisition of BELKIN, and advancements in contact lens technology, highlight its commitment to innovation. Alcon also established a collaboration with OcuMension in China, further solidifying its global presence. These recent developments demonstrate Alcon's strategic approach to capturing market opportunities and underline its commitment to growth and innovation.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.