Alcon (ALC) AI Stock Analysis

• Market Cap: CHF30.88B
• Dividend Yield: 0.44%
• Average Volume (3M): 820.64K
• Price to Earnings (P/E): 34.0
• Beta (1Y): 0.98
• Revenue Growth: 0.39%
• EPS Growth: -12.46%
• Country: US
• Employees: 25,599
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Instruments & Supplies
• EPS (TTM): 0.63
• Shares Outstanding: 499,700,000
• 10 Day Avg. Volume: 1,038,311
• 30 Day Avg. Volume: 820,643
• PEG Ratio: 10.18
• Price to Book (P/B): 1.94
• Price to Sales (P/S): 4.23
• P/FCF Ratio: 29.76
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: CHF71.84
• Price Target Upside: 16.25% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: CHF72.00 ▲(16.50% Upside)

Alcon's overall stock score reflects its strong financial performance and positive earnings call, highlighting growth in key areas like vision care and surgical equipment. However, valuation concerns and technical indicators suggest caution, with potential challenges from tariffs and market conditions impacting margins.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong product demand and effective market strategies, supporting long-term business expansion.

Innovation in Product Launches

Successful product launches like Unity VCS enhance competitive positioning and drive future revenue, reflecting a robust R&D pipeline.

Cash Flow Management

Strong cash flow management ensures liquidity and financial flexibility, enabling strategic investments and shareholder returns.

Negative Factors

Gross Margin Pressure

Decreasing gross margins due to tariffs could impact profitability and limit financial resources for reinvestment in growth.

Challenges in Cataract Markets

Slower growth in cataract markets may hinder revenue expansion in a key segment, affecting overall business performance.

Operating Margin Decline

Declining operating margins due to increased R&D investment and tariffs may pressure profitability and strategic flexibility.

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 through multiple streams, primarily from the sale of surgical products and vision care products. The Surgical segment includes revenue from cataract surgery devices, which are critical for treating cataracts, and refractive surgery devices used for vision correction procedures. The Vision Care segment derives income from the sale of contact lenses and lens care products, catering to both daily and extended wear needs. Alcon's revenue model is bolstered by strong relationships with healthcare professionals, hospitals, and clinics, which facilitate widespread distribution of its products. Additionally, the company invests in research and development to innovate new products and improve existing offerings, thereby enhancing its market competitiveness. Strategic partnerships with healthcare providers and participation in global eye care initiatives further contribute to its earnings.

Alcon Financial Statement Overview

Summary

Alcon demonstrates solid financial health with strong revenue growth and profitability margins. The balance sheet is stable, with manageable leverage and a healthy equity position. However, the decline in free cash flow growth and modest return on equity highlight areas for potential improvement.

Income Statement

Alcon's income statement shows strong performance with a consistent increase in total revenue over the years, highlighted by a TTM revenue growth rate of 1.60%. The company maintains healthy profitability margins, with a gross profit margin of 55.13% and a net profit margin of 10.70% in the TTM period. The EBIT and EBITDA margins are also robust at 14.38% and 17.26%, respectively, indicating efficient operational management. However, the slight decline in gross profit margin compared to previous years suggests potential cost pressures.

Balance Sheet

Alcon's balance sheet reflects a stable financial position with a manageable debt-to-equity ratio of 0.24, indicating prudent leverage use. The return on equity is modest at 4.93%, suggesting room for improvement in generating returns for shareholders. The equity ratio stands at a healthy level, reinforcing the company's financial stability. However, the relatively low ROE compared to industry peers may indicate underutilization of equity capital.

Cash Flow

The cash flow statement reveals a mixed picture. While the operating cash flow to net income ratio is strong at 0.85, indicating good cash generation relative to earnings, the free cash flow growth rate has declined by 1.81% in the TTM period. The free cash flow to net income ratio of 0.78 suggests that the company is generating adequate free cash flow, but the recent decline in growth could be a concern if it persists.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.19B	9.91B	9.46B	8.72B	8.29B	6.83B
Gross Profit	5.61B	5.51B	5.25B	4.75B	4.65B	2.94B
EBITDA	2.05B	2.68B	2.24B	1.72B	1.76B	1.11B
Net Income	1.05B	1.02B	974.00M	335.00M	376.00M	-531.00M
Balance Sheet
Total Assets	31.49B	30.35B	29.61B	29.21B	28.00B	27.60B
Cash, Cash Equivalents and Short-Term Investments	1.50B	1.83B	1.10B	980.00M	1.58B	1.57B
Total Debt	5.23B	5.14B	5.13B	5.07B	4.48B	4.50B
Total Liabilities	9.43B	8.79B	8.99B	9.53B	8.74B	8.78B
Stockholders Equity	22.06B	21.55B	20.62B	19.68B	19.26B	18.82B
Cash Flow
Free Cash Flow	1.59B	1.41B	537.00M	472.00M	165.00M	256.00M
Operating Cash Flow	2.05B	2.08B	1.39B	1.22B	1.34B	823.00M
Investing Cash Flow	-1.37B	-1.17B	-1.09B	-1.86B	-1.20B	-572.00M
Financing Cash Flow	-765.31M	-322.00M	-211.00M	-8.00M	-123.00M	466.00M

Alcon Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 61.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 61.8 is below the 20-day moving average (MA) of 63.59, below the 50-day MA of 63.26, and below the 200-day MA of 66.79, indicating a bearish trend. The MACD of -0.21 indicates Positive momentum. The RSI at 42.67 is Neutral, neither overbought nor oversold. The STOCH value of 21.48 is Neutral, 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
NOVN	80 Outperform	CHF217.35B	18.31	―	3.18%	7.62%	-18.33%
ALC	75 Outperform	CHF30.88B	34.00	4.82%	0.44%	0.39%	-12.46%
ROG	73 Outperform	CHF270.26B	19.84	31.98%	2.94%	4.77%	-11.07%
STMN	72 Outperform	CHF14.91B	37.95	―	1.02%	4.49%	45.08%
GALD	70 Outperform	CHF33.89B	104.44	―	0.09%	6.22%	―
SOON	68 Neutral	CHF12.16B	24.21	―	2.14%	3.79%	-7.84%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%