Critical Survey: Bausch + Lomb (NYSE:BLCO) and CochLear (OTCMKTS:CHEOY)

Bausch + Lomb (NYSE:BLCO) and CochLear (OTCMKTS:CHEOY) are both mid-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Valuation and Earnings

This table compares Bausch + Lomb and CochLear”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bausch + Lomb	$5.21 billion	1.10	-$360.00 million	($0.62)	-25.97
CochLear	$1.53 billion	3.14	$251.85 million	N/A	N/A

CochLear has lower revenue, but higher earnings than Bausch + Lomb.

Analyst Recommendations

This is a summary of current ratings for Bausch + Lomb and CochLear, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bausch + Lomb	1	9	4	0	2.21
CochLear	0	3	1	1	2.60

Bausch + Lomb presently has a consensus target price of $18.08, suggesting a potential upside of 12.32%. Given Bausch + Lomb’s higher possible upside, analysts clearly believe Bausch + Lomb is more favorable than CochLear.

Volatility and Risk

Bausch + Lomb has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500. Comparatively, CochLear has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500.

Profitability

This table compares Bausch + Lomb and CochLear’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bausch + Lomb	-4.21%	3.60%	1.69%
CochLear	N/A	N/A	N/A

Institutional and Insider Ownership

11.1% of Bausch + Lomb shares are owned by institutional investors. 1.5% of Bausch + Lomb shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Bausch + Lomb beats CochLear on 7 of the 13 factors compared between the two stocks.

About Bausch + Lomb

Bausch + Lomb Corporation operates as an eye health company in the United States, Puerto Rico, China, France, Japan, Germany, the United Kingdom, Canada, Russia, Spain, Italy, Mexico, Poland, South Korea, and internationally. It operates in three segments: Vision Care, Pharmaceuticals, and Surgical. The Vision Care segment provides contact lens that covers the spectrum of wearing modalities, including daily disposable and frequently replaced contact lenses; and contact lens care products comprising over-the-counter eye drops, eye vitamins, and mineral supplements that address various conditions, such as eye allergies, conjunctivitis, dry eye, and redness relief. Its Pharmaceuticals segment offers proprietary and generic pharmaceutical products for post-operative treatments, as well as for the treatment of glaucoma, eye inflammation, ocular hypertension, dry eyes, and retinal diseases. The Surgical segment provides medical device equipment, consumables, and technologies for the treatment of cataracts, corneal, vitreous, and retinal eye conditions; and intraocular lenses and delivery systems, phacoemulsification equipment, and other surgical instruments and devices for cataract surgery. The company sells its products and services through direct sales forces and independent distributors. Bausch + Lomb Corporation was founded in 1853 and is headquartered in Vaughan, Canada. Bausch + Lomb Corporation is a subsidiary of Bausch Health Companies Inc.

About CochLear

Cochlear Limited provides implantable hearing solutions for children and adults worldwide. It offers cochlear implant systems, sound processor upgrades, bone conduction systems, accessories, and other products. Cochlear Limited was founded in 1981 and is headquartered in Sydney, Australia.