$1,000, 5 Years Later: Valeant’s Wild Ride To Bausch Health
Wayne Duggan, 16 February 2021
Investors who have owned stocks since 2016 generally have experienced some big gains. In fact, the SPDR S&P 500
SPY total return in the last five years is 131.9%. But there is no question some big-name stocks performed better than others along the way.
Valeant’s Downfall: One company that has been a disastrous investment in the last five years is health care company Bausch Health Companies Inc BHC 0.06% , formerly known as Valeant Pharmaceuticals. Not only has Bausch lagged the overall market in the last five years, Valeant represents one of the most infamous stock collapses in recent decades. Bausch produces pharmaceutical products and generic drugs. It is also the parent company of eye health products leader Bausch & Lomb.
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Bausch Health jumps after short seller says stock could double
Cristin Flanagan, 15 October 2019
Shares of Bausch Health Cos. jumped as much as 5.5 per cent intraday after a short-seller changed his tune and said the stock could nearly double. Also, Bausch shed another bear as Wells Fargo realigned its coverage. Andrew Left’s Citron Research set a price target of US$40, more than 80 per cent above current trading. The report comes more than four years after the short-seller’s 2015 call, when Left accused Bausch, then known as Valeant Pharmaceuticals, of being “Enron part deux.”
Bausch shares have come down more than 90 per cent from 2015. The stock “still trades with a ‘Valeant discount’ despite new management’s 180-degree turn,” the Citron report said. Bausch’s Nov. 4 earnings may be when Wall Street finally takes notice, it added.
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Citron Calls Bausch Health — Formerly Valeant — The ‘Textbook Turnaround’
Wayne Duggan, 15 October 2019
Three years after Citron Research called Valeant the “pharmaceutical Enron,” the firm said Tuesday that it’s time to give Valeant successor Bausch Health Companies Inc BHC 0.06% the credit it is due for its rebranding and turnaround efforts.
On Tuesday, Citron Research’s Andrew Left said CEO Joe Papa has done a spectacular job since taking over less than four years ago. In the past three years alone, management has paid down about $8 billion in debt, vastly improving the company’s balance sheet and putting them in a position of financial flexibility.
“In 2019, the debt has become manageable and the company is gaining momentum with recent, successful launches of new drugs, consistent with its ‘pivot to offense,’” Left said.
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BAUSCH HEALTH – THE TEXTBOOK TURNAROUND Giving Credit Where Credit is Due – Target Price $40
Citron Research, 15 October 2019
It was four years ago this month that Citron wrote a series of articles that were instrumental in the unraveling of the Pearson-era Valeant business model. In quick manner the stock has declined by 90% from its highs as the scandals unraveled and many questioned the sustainability of the equity.
Four years later BHC still trades with a “Valeant discount” despite new management’s 180-degree turn of corporate culture. To add to the artificially depressed share price, Bausch has been unjustly grouped with Specialty Pharma despite having ZERO opioid exposure and minimal exposure to the generics market.
Citron believes this quarter (reporting on Nov 4) will force Wall St. to finally take notice of BHC’s “pivot to offense”. Once this is considered along with the acknowledgment of the recent M&A spree in pharma, even David Maris will have to admit that BHC is on its way to $40.
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