Jeff Parent B. Eng. FCSI CIM Bausch Health Companies Inc BHC-N DON'T BUY Apr 05, 2019

The former Valient Pharmaceuticals. It looks like it could rally $10 on a new breakout. Hold off until for a while as he does not see a real trend forming yet. Trade with a $28 stop-loss. (Analysts’ price target is $40.00)

Jeff Parent B. Eng. FCSI CIM

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$25.120

Stock price when the opinion was issued

Healthcare

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DON'T BUY

Formally Valiant. It had a rise and fall from grace. It bottomed over the last year. There is a lot of volatility. They addressed some of the concerns. Investors worry about R&D; and about drugs coming off patent. He does not know about their pipelines. If you can handle the risk, there are few companies where you can play the sector. There are more names in the US in this space that are attractive.

DON'T BUY

You have been through ups and down with this one including a name change from Valiant. It has decent price momentum. They are trying to reconcile their balance sheet. Forward numbers look a lot better than backward looking numbers. They are not cheap enough and it is still a volatile stock. They have too much debt so avoid it.

COMMENT

R&D-to-sales metric steered him away from Valeant (what Bausch used to be named). The current CEO is doing a great job transitioning and paying debt and de-risking the company. They appear to be doing well during this restructuring.

HOLD

There is no yield, so it falls outside his ranking system. Overall growth in earnings is basically flat. The PE ratio is only 5 times so he feels the market is somewhat skeptical.

COMMENT

Has been rangebound for two years, but recently broke out. That's good--it's going higher. Support around $36 and he predicts it will fall back here during the predicted market pullback to come.

BUY

He bought it today. It's a comeback story. This used to be the hated, shady, debt-heavy Valeant which collapsed in 2015. Then, the new CEO did a remarkable job settling its legal problems, repaying a lot of debt, fixing the business model and stabilizing the business. Last year, the CEO planned to spin off Bausch and Lomb as its own eyecare business and Solta, the asthetic business by early 2022. Solta had $219 million in sales through the first 9 months of 2021. Solta products gives people smooth skin. This business grows at 27%, and should generate $171.5 million in EBITDA. What's left after the spin-offs is a pure-play pharma business. But Bausch still carries a mountain of debt. All told, he sees much more upside.

HOLD

He suspect the shares are being manipulated down. There's no reason that the shares should be this low, down 61% in the last three months. But he's hanging on.

SELL

Is stunned by how poorly it's done.

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Jeff Parent B. Eng. FCSI CIM Bausch Health Companies Inc BHC-N DON'T BUY Apr 05, 2019

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