May 6, 2022
We wrote about Bausch Health Companies back in September 2020: “Bausch Health Companies: This Story Is Not Over Yet” after company announced its intention to spin-off its eye health business into an independent publicly traded company.
We believe that at $18 per share company is attractive as it would be valued at an EV/EBITDA (FY 2021) multiple of about x11.5 and have a Free Cash Flow Yield of about 8.5% percent.
Compared to this, Alcon for example trades at a significant premium at x20 EV/EBITDA.
We think that Bausch + Lomb IPO provides investors an attractive event-driven, value investment story with significant upside potential over next three years (more than 100% percent) and could also become a buyout target.