SWX:ALC

Stock Analysis Report

Executive Summary

Alcon, Inc. develops and manufactures eye care products for eye care professionals and their patients.

Rewards

Trading at 0.8% below its fair value

Earnings are forecast to grow 83.18% per year

Risk Analysis

No risks detected for ALC from our risk checks.


Snowflake Analysis

Adequate balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

How has Alcon's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ALC has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.9%

ALC

3.1%

CH Medical Equipment

0.6%

CH Market


1 Year Return

n/a

ALC

34.0%

CH Medical Equipment

16.9%

CH Market

Return vs Industry: Insufficient data to determine how ALC performed against the Swiss Medical Equipment industry.

Return vs Market: Insufficient data to determine how ALC performed against the Swiss Market.


Shareholder returns

ALCIndustryMarket
7 Day0.9%3.1%0.6%
30 Day3.6%5.2%1.9%
90 Day9.6%11.8%7.4%
1 Yearn/a35.3%34.0%22.5%16.9%
3 Yearn/a100.8%94.2%40.4%23.2%
5 Yearn/a175.2%157.3%45.3%22.3%

Price Volatility Vs. Market

How volatile is Alcon's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Alcon undervalued compared to its fair value and its price relative to the market?

1.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ALC (CHF62.17) is trading below our estimate of fair value (CHF62.68)

Significantly Below Fair Value: ALC is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: ALC is unprofitable, so we can't compare its PE Ratio to the Medical Equipment industry average.

PE vs Market: ALC is unprofitable, so we can't compare its PE Ratio to the Swiss market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ALC's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ALC is good value based on its PB Ratio (1.6x) compared to the CH Medical Equipment industry average (6.8x).


Next Steps

Future Growth

How is Alcon forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

83.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ALC is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (-0.6%).

Earnings vs Market: ALC is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: ALC's is expected to become profitable in the next 3 years.

Revenue vs Market: ALC's revenue (4.8% per year) is forecast to grow faster than the Swiss market (3.4% per year).

High Growth Revenue: ALC's revenue (4.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ALC's Return on Equity is forecast to be low in 3 years time (5.3%).


Next Steps

Past Performance

How has Alcon performed over the past 5 years?

-60.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ALC is currently unprofitable.

Growing Profit Margin: ALC is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: ALC is unprofitable, and losses have increased over the past 5 years at a rate of -60.8% per year.

Accelerating Growth: Unable to compare ALC's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: ALC is unprofitable, making it difficult to compare its past year earnings growth to the Medical Equipment industry (-9.5%).


Return on Equity

High ROE: ALC has a negative Return on Equity (-3.29%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Alcon's financial position?


Financial Position Analysis

Short Term Liabilities: ALC's short term assets ($4.2B) exceed its short term liabilities ($2.2B).

Long Term Liabilities: ALC's short term assets ($4.2B) do not cover its long term liabilities ($6.0B).


Debt to Equity History and Analysis

Debt Level: ALC's debt to equity ratio (17.9%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if ALC's debt to equity ratio has reduced over the past 5 years.


Balance Sheet

Inventory Level: ALC has a low level of unsold assets or inventory.

Debt Coverage by Assets: ALC's debt is covered by short term assets (assets are 1.2x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable ALC has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: ALC is unprofitable but has sufficient cash runway for more than 3 years, even with free cash flow being positive and shrinking by -37.7% per year.


Next Steps

Dividend

What is Alcon's current dividend yield, its reliability and sustainability?

0.31%

Forecast Dividend Yield


Dividend Yield vs Market

companyn/amarketbottom25%1.7%markettop25%3.4%industryaverage0.9%forecastin3Years0.3%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate ALC's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate ALC's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ALC's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ALC's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ALC's dividend in 3 years as they are not forecast to pay a notable one for the Swiss market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.6yrs

Average management tenure


CEO

David Endicott (54yo)

1.6yrs

Tenure

0

Mr. David J. Endicott had been the Chief Executive Officer of Alcon, Inc. since July 1, 2018. Mr. Endicott has been the President of Hospira Medical Devices at Hospira Inc. since March 10, 2014. Mr. Endico ...


Leadership Team

NamePositionTenureCompensationOwnership
Merrick McCracken
Senior VP & Head of Global Human Resources0yrsUS$1.75mno data
Ed McGough
Senior VP and Head of Global Manufacturing & Technical Operations0yrsUS$2.03mno data
David Endicott
CEO & Director1.6yrsno datano data
Timothy Stonesifer
Senior VP & CFO0.8yrsno datano data
Margaret Buckley
Chief Accounting Officer0yrsno datano data
Sue-Jean Lin
Senior VP & Chief Information Officer0yrsno datano data
Karen King
Senior VP and Head of Global Investor Relations & Communications0yrsno datano data
Royce Bedward
Senior VP0yrsno datano data
Laurent Attias
Senior VP & Head of Global Corporate Development Strategy0yrsno datano data
Sergio Duplan
Region President for North America4.5yrsno datano data

1.6yrs

Average Tenure

53.5yo

Average Age

Experienced Management: ALC's management team is not considered experienced ( 1.6 years average tenure), which suggests a new team.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: ALC only recently listed within the past 12 months, with total shares outstanding growing by 0% in the past year..


Top Shareholders

Company Information

Alcon, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Alcon, Inc.
  • Ticker: ALC
  • Exchange: SWX
  • Founded: 1945
  • Industry: Health Care Supplies
  • Sector: Healthcare
  • Market Cap: CHF30.490b
  • Shares outstanding: 491.70m
  • Website: https://www.alcon.com

Number of Employees


Location

  • Alcon, Inc.
  • Chemin de Blandonnet 8
  • 1214 Vernier
  • Geneva
  • Switzerland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2U3BST (Boerse-Stuttgart)YesCommon SharesDEEURApr 2019
ALC NBMV (Bolsa Mexicana de Valores)YesCommon SharesMXMXNApr 2019
2U3DB (Deutsche Boerse AG)YesCommon SharesDEEURApr 2019
ALCSWX (SIX Swiss Exchange)YesCommon SharesCHCHFApr 2019
ALCNYSE (New York Stock Exchange)YesCommon SharesUSUSDApr 2019
0A0DLSE (London Stock Exchange)YesCommon SharesGBUSDApr 2019

Biography

Alcon, Inc. develops and manufactures eye care products for eye care professionals and their patients. It offers surgical products, which include technologies and devices for cataract, retinal, glaucoma, and refractive surgery; advanced technology intraocular lenses to treat cataracts and refractive errors, such as presbyopia and astigmatism; and advanced viscoelastics, surgical solutions, surgical packs, and other disposable products for cataract and vitreoretinal surgery. The company also provides pharmaceutical products for elevated intraocular pressure caused by glaucoma; anti-inflammatories; anti-infective to aid in the treatment of bacterial infections and bacterial conjunctivitis; ophthalmic solutions to treat inflammation and pain associated with ocular surgery; eye inflammation and infection solutions following cataract surgery; and vitreomacular adhesion, eye and nasal allergy treatment solutions, and over-the-counter dry eye relief and ocular vitamins. In addition, it offers vision care products, such as contact lenses and lens care products; daily disposable, monthly replacement, and color-enhancing contact lenses for comfortable and convenient vision correction options; contact lens care products; multi-purpose and hydrogen-peroxide based solutions to clean, rinse, and disinfect contact lenses; rewetting drops; and daily protein removers that removes protein deposits from lenses. Alcon, Inc. was formerly known as Alcon Universal S.A. and changed the name to Alcon, Inc. in December 2001. The company was founded in 1945 and is headquartered in Geneva, Switzerland. Alcon, Inc. was previously operating as a subsidiary of Novartis AG. Alcon, Inc.(SWX:ALC) operates independently of Novartis AG as of April 9, 2019. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/22 00:11
End of Day Share Price2020/02/21 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.