A Fresh Look at Bausch Health Companies (NYSE:BHC) Valuation Following Turnaround in Third-Quarter Results

Bausch Health Companies (NYSE:BHC) just announced its third-quarter results, showing a boost in revenue and a move from a net loss last year to a net income this time around. The results for the past nine months also point to steady gains in both revenue and profit, sparking fresh conversations among investors about the company’s ongoing recovery.

See our latest analysis for Bausch Health Companies.

While Bausch Health Companies is reporting stronger profits and climbing revenue, its share price has not yet reflected this turnaround. The company has shown a 1-year share price return of -16.25% and a total shareholder return of -28.8%. Shorter-term momentum is mixed, as a recent 9.9% gain over the last 30 days has only partially offset earlier losses. This leaves longer-term investors still in negative territory.

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Given the recent earnings rebound and ongoing recovery, investors are left wondering if Bausch Health Companies is currently undervalued with more upside ahead or if the market has already priced in its expected growth.

Most Popular Narrative: 6.1% Undervalued

Bausch Health Companies closed at $6.65, while the most popular narrative sees fair value at $7.08. This subtle gap has drawn attention, with key company moves and sector trends poised to tip the balance.

Bausch's initiatives to expand in gastroenterology and hepatology, notably through the acquisition of DURECT and ongoing late-stage pipeline development (e.g., SSD rifaximin Phase III), position the company to capitalize on rising chronic disease rates and aging populations. This could potentially drive future revenue growth.

Read the complete narrative.

How is this fair value built? It all comes down to a strategic push into high-growth health markets, fueled by projected profit gains and tighter price-to-earnings assumptions than most peers. Wondering which forecasted numbers unlock this upside? Read the full narrative and see where expectations diverge from consensus.

Result: Fair Value of $7.08 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, significant risks remain, including potential Medicare price cuts for Xifaxan and the company's ongoing high debt levels, which could alter this outlook.

Find out about the key risks to this Bausch Health Companies narrative.

Build Your Own Bausch Health Companies Narrative

If you see the story differently or want to run the numbers your own way, you can craft your own view of Bausch Health Companies in just a few minutes. Do it your way

A great starting point for your Bausch Health Companies research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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