Last week, you might have seen that Bausch + Lomb Corporation (NYSE:BLCO) released its quarterly result to the market. The early response was not positive, with shares down 8.0% to US$13.60 in the past week.       Revenues of US$1.1b beat expectations by a respectable 2.9%, although statutory losses per share increased. Bausch + Lomb lost US$0.48, which was 212% more than what the analysts had included in their models.     Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual.  So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

NYSE:BLCO Earnings and Revenue Growth May 4th 2024

After the latest results, the twelve analysts covering Bausch + Lomb are now predicting revenues of US$4.66b in 2024. If met, this would reflect a meaningful 8.1% improvement in revenue compared to the last 12 months.      The loss per share is expected to greatly reduce in the near future, narrowing 62% to US$0.36.       Before this earnings announcement, the analysts had been modelling revenues of US$4.66b and losses of US$0.28 per share in 2024.         So it's pretty clear the analysts have mixed opinions on Bausch + Lomb even after this update; although they reconfirmed their revenue numbers, it came at the cost of a regrettable increase in per-share losses.    

With the increase in forecast losses for next year, it's perhaps no surprise to see that the average price target dipped 6.1% to US$18.57, with the analysts signalling that growing losses would be a definite concern.        That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets.  Currently, the most bullish analyst values Bausch + Lomb at US$26.00 per share, while the most bearish prices it at US$14.00.   Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.    

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Bausch + Lomb's growth to accelerate, with the forecast 11% annualised growth to the end of 2024 ranking favourably alongside historical growth of 5.0% per annum over the past three years.    By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 8.1% per year.  Factoring in the forecast acceleration in revenue, it's pretty clear that Bausch + Lomb is expected to grow much faster than its industry.    

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Bausch + Lomb.        Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry.       Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.  

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider.   We have forecasts for Bausch + Lomb going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Bausch + Lomb that you need to be mindful of.  

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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.