Alcon (ALC) to Report Q1 Earnings: What's in the Cards?

Alcon Inc. ALC is expected to report first-quarter 2022 results on May 10, following market close.

In the last-reported quarter, the company’s earnings per share (EPS) of 56 cents beat the Zacks Consensus Estimate by 14.3%. Moreover, its earnings surpassed the consensus estimate in the trailing four quarters. The average earnings surprise was 16.52%.

Let's see how things have shaped up prior to the announcement.

Factors At Play

Similar to the fourth quarter of 2021, Alcon’s Surgical business is expected to gain from its market-leading position in presbyopia-correcting (intraocular lens) IOLs on the strength of PanOptix and Vivity. Moreover, the company continues to witness strong penetration of advanced technology lenses with the expansion of the global cataract surgery market. This is expected to have contributed to Alcon’s first-quarter revenue growth.

In January 2022, Alcon acquired Ivantis, developer of the novel Hydrus Microstent, a minimally-invasive glaucoma surgery (MIGS) device designed to lower eye pressure for open-angle glaucoma patients in connection with cataract surgery. With this acquisition, Alcon will leverage its global footprint and leadership in ophthalmology to drive growth, bringing this innovative device to more patients worldwide. This major development is expected to have contributed significantly in the to-be-reported quarter.

However, slower-than-expected recovery in the end market due to the surge in new variants of COVID-19 cases is likely to have affected the Surgical business performance in the first quarter.

The Zacks Consensus Estimate for first-quarter 2022 Surgical revenues is pegged at $1.15 billion, suggesting a decline of 8.3% from the previous quarter.

Alcon Price and EPS Surprise

Alcon Price and EPS Surprise

Alcon price-eps-surprise | Alcon Quote

Within Vision Care, Alcon is expected to gain from continued strong demand for PRECISION1 and PRECISION1 for Astigmatism, which are the company’s newest contact lenses for the mainstream market. Alcon is currently focused on expanding its contact lens offerings to the premium and middle-market segments by launching a steady stream of new silicone hydrogel daily and reusable products. Simultaneously, the company is building its TOTAL brand in the premium segment. These developments are likely to have benefitted Alcon in the to-be-reported quarter, thus adding to the top line.

In March 2022, Alcon launched the Clareon family of intraocular lenses (IOLs) in the United States, utilizing its most advanced IOL material. In January 2022, Alcon announced the broad commercial launch of Dailies TOTAL1 for Astigmatism in the United States, which has been strongly demanded by eye care professionals and completes its Dailies TOTAL1 portfolio.

These developments are expected to have contributed significantly to first-quarter 2022 revenues on strong market adoption.

The Zacks Consensus Estimate for the company’s first-quarter 2022 Vision Care revenues is pegged at $885 million, suggesting an improvement of 1.1% from the previous quarter’s reported figure.

The Estimate Picture

For first-quarter 2022, the Zacks Consensus Estimate for total revenues of $2.04 billion implies an improvement of 6.8% from the prior-year quarter’s figure.

The consensus estimate for earnings per share is pegged at 52 cents, indicating a rise of 6.1% from the prior-year quarter’s figure.

What Our Model Suggests

Our proven model predicts an earnings beat for Alcon this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: The company has an Earnings ESP of +10.04%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter..

Zacks Rank: The company currently carries a Zacks Rank #3.

Other Stocks Worth a Look

Here are a few other medical stocks worth considering as these also have the right combination of elements to post an earnings beat this quarter.

Clovis Oncology CLVS has an Earnings ESP of +2.33% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Clovis boasts a mixed track record, having topped earnings estimates in two of the last four quarters and missing in the remaining two. Clovis pulled off a four-quarter earnings surprise of 1.44%, on average.

Vertex VRTX has an Earnings ESP of +0.87% and a Zacks Rank #2.

Vertex topped earnings estimates in the last four quarters. Vertex delivered a four-quarter earnings surprise of 10.01%, on average.

Jazz Pharmaceuticals JAZZ has an Earnings ESP of +3.04% and a Zacks Rank #3.

Jazz topped earnings estimates in the last four quarters. Jazz delivered a four-quarter earnings surprise of 14.5%, on average.

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Vertex Pharmaceuticals Incorporated (VRTX) : Free Stock Analysis Report

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