Alcon (ALC) AI Stock Analysis

• Market Cap: $36.72B
• Dividend Yield: 0.38%
• Average Volume (3M): 953.94K
• Price to Earnings (P/E): 36.6
• Beta (1Y): 0.95
• Revenue Growth: 3.90%
• EPS Growth: 6.76%
• Country: CH
• Employees: 25,599
• Sector: Healthcare
• Sector Strength: 55
• Industry: Medical - Instruments & Supplies
• EPS (TTM): 0.61
• Shares Outstanding: 499,700,000
• 10 Day Avg. Volume: 814,504
• 30 Day Avg. Volume: 953,943
• PEG Ratio: -0.40
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 113.19
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 1.12
• Enterprise Value/Gross Profit: 13.66
• Enterprise Value/Ebitda: 4.86
• 1Y Price Target: $88.56
• Price Target Upside: 24.90% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 16

• Rating: 73 Outperform
• Price Target: CHF82.00 ▲(15.66%Upside)

Alcon's strong financial performance is the primary driver of its overall score, supported by robust cash flow and low leverage. However, technical indicators show downward momentum, and valuation metrics suggest the stock is expensive. The recent earnings call provides a balanced view with upcoming growth potential from new products and acquisitions, offset by existing market challenges.

Positive Factors

FDA Approval

FDA approval has been secured for TRYPTYR, the drug is indicated for both the signs and symptoms of dry eye disease, which is a significant milestone for ALC.

Product Launch

The product launch cycle is expected to fuel appealing exit rates for 2026, enhancing growth prospects.

Unity DX Launch

Unity DX is a 6-in-1 'whole-eye' analyzer for the clinic, expected to help drive AT-IOL adoption, reduce AT-IOL pre-op time by up to ~50%, lower equipment acquisition cost by up to ~40%, and reduce refractive error with better lens selection.

Negative Factors

Core EBIT Margin

Core EBIT margin outlook is reduced from 21-22% to 20-21%, suggesting a -3% cut to consensus.

Market Competition

Alcon faces intense competition in the intraocular lenses market, potentially leading to share loss.

Sales Performance

The company's sales in both the Surgical and Vision Care segments were below analyst estimates.

Alcon Business Overview & Revenue Model

Company Description

Alcon Inc., an eye care company, researches, develops, manufactures, distributes, and sells eye care products for eye care professionals and their patients worldwide. The company's Surgical segment offers equipment, instrumentation and diagnostics, intraocular lenses (IOLs), and other implantables; and consumables, including viscoelastics, surgical solutions, incisional instruments, surgical custom packs, and other products for use in surgical procedures. Its cataract products include centurion vision system, LenSx femtosecond laser, LuxOR surgical ophthalmic microscope, NGENUITY 3D visualization system, and ORA system for intra-operative measurements; custom pak surgical procedure packs; vitreoretinal products comprising constellation vision systems, procedure packs, lasers and hand-held microsurgical instruments, and grieshaber and MIVS instruments, as well as scissors, forceps and micro-instruments, medical grade vitreous tamponades, and Hypervit vitrectomy probes; refractive surgery products, including WaveLight lasers and Contoura Vision used for LASIK treatment; EX-PRESS glaucoma filtration device; and implantables products, including AcrySof IQ IOLs products include monofocal IOLs and advanced technology IOLs under the PanOptix and ReSTOR brands for the correction of presbyopia and astigmatism at the time of cataract surgery. Its Vision Care segment provides daily disposable, reusable, and color-enhancing contact lenses; ocular health products, such as dry eye, glaucoma, contact lens care, and ocular allergies; and ocular vitamins and redness relievers under the TOTAL, PRECISION, DAILIES AquaComfort PLUS, Air Optix, Opti-Free, Clear Care, Tears Naturale, Genteal, ICAPS, and Vitalux brands. The company was formerly known as Alcon Universal S.A. and changed the name to Alcon Inc. in December 2001. Alcon Inc. was founded in 1945 and is headquartered in Geneva, Switzerland.

How the Company Makes Money

Alcon generates revenue primarily through the sale of its eye care products and surgical equipment. In the Surgical segment, revenue is driven by sales of equipment and consumables used in eye surgeries, such as cataract and vitreoretinal surgeries. The Vision Care segment generates income from the sale of contact lenses and lens care solutions. Alcon's earnings are bolstered by its strong global distribution network, strategic partnerships with eye care professionals, and continuous investment in research and development to innovate and expand its product offerings. Additionally, Alcon benefits from an increasing demand for eye care solutions due to an aging population and rising awareness of vision health.

Alcon Financial Statement Overview

Summary

Alcon is financially robust with strong revenue and profit growth. The income statement shows improved margins, the balance sheet reflects low leverage and high equity ratios, and cash flow statements demonstrate excellent liquidity and cash generation. Overall, Alcon is well-positioned for sustained growth.

Income Statement

Alcon's income statement shows strong growth and profitability. The gross profit margin increased to 55.6%, indicating efficient cost management. Net profit margin improved to 10.3%, reflecting robust earnings growth. Revenue growth rate from the previous year was 4.8%, maintaining a positive trajectory. EBIT margin increased to 14.3% and EBITDA margin to 27.0%, suggesting enhanced operational efficiency. Overall, Alcon's income statement reflects a solid financial performance with improving margins and consistent revenue growth.

Balance Sheet

Alcon's balance sheet is stable with a debt-to-equity ratio of 0.24, indicating a low level of leverage, which reduces financial risk. Return on equity improved to 4.7%, showing better utilization of equity. The equity ratio is strong at 71.0%, underscoring a robust financial structure. The balance sheet reflects a well-capitalized company with low reliance on debt, although there is room for improvement in returns to shareholders.

Cash Flow

Alcon's cash flow statement is very strong, with a significant free cash flow growth rate of 161.9%, highlighting excellent cash generation. The operating cash flow to net income ratio is 2.04, indicating efficient cash conversion. The free cash flow to net income ratio of 1.38 further confirms strong cash flow management. Overall, the cash flow statements point to excellent liquidity and financial flexibility, supporting future growth and investment.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
9.46B	9.91B	9.46B	8.72B	8.29B	6.83B
	Gross Profit
5.25B	5.51B	5.25B	4.75B	4.65B	2.94B
	EBIT
1.04B	1.41B	1.04B	672.00M	580.00M	-511.00M
	EBITDA
2.11B	2.68B	2.24B	1.72B	1.76B	1.11B
	Net Income Common Stockholders
974.00M	1.02B	974.00M	335.00M	376.00M	-531.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.10B	1.83B	1.10B	980.00M	1.58B	1.56B
	Total Assets
29.61B	30.35B	29.61B	29.21B	28.00B	27.60B
	Total Debt
5.13B	5.14B	5.13B	5.07B	4.48B	4.50B
	Net Debt
4.04B	3.31B	4.04B	4.09B	2.90B	2.94B
	Total Liabilities
8.99B	8.79B	8.99B	9.53B	8.74B	8.78B
	Stockholders Equity
20.62B	21.55B	20.62B	19.68B	19.26B	18.82B
Cash Flow		Free Cash Flow
596.00M	1.41B	537.00M	472.00M	165.00M	256.00M
	Operating Cash Flow
1.39B	2.08B	1.39B	1.22B	1.34B	823.00M
	Investing Cash Flow
-1.09B	-1.17B	-1.09B	-1.86B	-1.20B	-572.00M
	Financing Cash Flow
-211.00M	-322.00M	-211.00M	-8.00M	-123.00M	466.00M

Alcon Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 70.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:ALC, the sentiment is Negative. The current price of 70.9 is below the 20-day moving average (MA) of 72.19, below the 50-day MA of 75.27, and below the 200-day MA of 78.74, indicating a neutral trend. The MACD of -1.09 indicates Negative momentum. The RSI at 46.37 is Neutral, neither overbought nor oversold. The STOCH value of 87.28 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CH:ALC.

Alcon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALC	73 Outperform	$36.72B	36.60	5.23%	0.38%	3.90%	6.76%
Sector *	54 Neutral	$5.38B	3.31	-45.11%	3.29%	16.82%	0.04%
RHHVF		$269.93B	27.86	26.76%	3.28%	―	―
NOVN	81 Outperform	CHF184.61B	16.99		3.61%	6.34%	-13.16%
STMN	78 Outperform	CHF17.15B	43.27		0.88%	3.82%	57.08%
LONN	64 Neutral	CHF40.58B	64.57		1.04%	-2.13%	2.50%
GALD		CHF27.04B	132.87		0.13%	―	―