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ALCON INC (ALC) Stock Fundamental Analysis

NYSE:ALC - New York Stock Exchange, Inc. - CH0432492467 - Common Stock

88.54  +4.17 (+4.94%)

After market: 88.54 0 (0%)

Fundamental Rating

6

Overall ALC gets a fundamental rating of 6 out of 10. We evaluated ALC against 191 industry peers in the Health Care Equipment & Supplies industry. While ALC has a great profitability rating, there are some minor concerns on its financial health. ALC has a correct valuation and a medium growth rate.


Dividend Valuation Growth Profitability Health

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7

1. Profitability

1.1 Basic Checks

In the past year ALC was profitable.
ALC had a positive operating cash flow in the past year.
In multiple years ALC reported negative net income over the last 5 years.
ALC had a positive operating cash flow in each of the past 5 years.
ALC Yearly Net Income VS EBIT VS OCF VS FCFALC Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 500M -500M 1B

1.2 Ratios

ALC has a better Return On Assets (3.82%) than 77.89% of its industry peers.
ALC has a Return On Equity of 5.43%. This is in the better half of the industry: ALC outperforms 80.00% of its industry peers.
ALC has a better Return On Invested Capital (3.41%) than 73.68% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ALC is significantly below the industry average of 8.08%.
The 3 year average ROIC (2.40%) for ALC is below the current ROIC(3.41%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 3.82%
ROE 5.43%
ROIC 3.41%
ROA(3y)1.93%
ROA(5y)0.3%
ROE(3y)2.79%
ROE(5y)0.43%
ROIC(3y)2.4%
ROIC(5y)N/A
ALC Yearly ROA, ROE, ROICALC Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 0 2 -2 4

1.3 Margins

The Profit Margin of ALC (11.89%) is better than 88.95% of its industry peers.
Looking at the Operating Margin, with a value of 13.47%, ALC belongs to the top of the industry, outperforming 82.63% of the companies in the same industry.
ALC's Operating Margin has improved in the last couple of years.
ALC has a Gross Margin of 55.47%. This is comparable to the rest of the industry: ALC outperforms 48.42% of its industry peers.
In the last couple of years the Gross Margin of ALC has grown nicely.
Industry RankSector Rank
OM 13.47%
PM (TTM) 11.89%
GM 55.47%
OM growth 3YN/A
OM growth 5Y35.03%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y7.1%
GM growth 5Y2.18%
ALC Yearly Profit, Operating, Gross MarginsALC Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 0 20 40

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6

2. Health

2.1 Basic Checks

ALC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, ALC has more shares outstanding
The number of shares outstanding for ALC has been increased compared to 5 years ago.
The debt/assets ratio for ALC has been reduced compared to a year ago.
ALC Yearly Shares OutstandingALC Yearly Shares OutstandingYearly Shares Outstanding 2017 2018 2019 2020 2021 2022 2023 100M 200M 300M 400M
ALC Yearly Total Debt VS Total AssetsALC Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2017 2018 2019 2020 2021 2022 2023 5B 10B 15B 20B 25B

2.2 Solvency

ALC has an Altman-Z score of 4.42. This indicates that ALC is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.42, ALC is doing good in the industry, outperforming 74.21% of the companies in the same industry.
The Debt to FCF ratio of ALC is 4.20, which is a neutral value as it means it would take ALC, 4.20 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of ALC (4.20) is better than 83.68% of its industry peers.
A Debt/Equity ratio of 0.23 indicates that ALC is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.23, ALC is in line with its industry, outperforming 52.63% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.23
Debt/FCF 4.2
Altman-Z 4.42
ROIC/WACC0.73
WACC4.7%
ALC Yearly LT Debt VS Equity VS FCFALC Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 5B 10B 15B 20B

2.3 Liquidity

A Current Ratio of 2.57 indicates that ALC has no problem at all paying its short term obligations.
ALC's Current ratio of 2.57 is in line compared to the rest of the industry. ALC outperforms 47.37% of its industry peers.
A Quick Ratio of 1.60 indicates that ALC should not have too much problems paying its short term obligations.
ALC has a Quick ratio (1.60) which is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 2.57
Quick Ratio 1.6
ALC Yearly Current Assets VS Current LiabilitesALC Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B 4B 5B

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5

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 22.27% over the past year.
The Earnings Per Share has been growing by 38.11% on average over the past years. This is a very strong growth
ALC shows a small growth in Revenue. In the last year, the Revenue has grown by 5.25%.
Measured over the past years, ALC shows a small growth in Revenue. The Revenue has been growing by 5.74% on average per year.
EPS 1Y (TTM)22.27%
EPS 3Y38.11%
EPS 5YN/A
EPS Q2Q%22.73%
Revenue 1Y (TTM)5.25%
Revenue growth 3Y11.43%
Revenue growth 5Y5.74%
Sales Q2Q%5.64%

3.2 Future

The Earnings Per Share is expected to grow by 11.48% on average over the next years. This is quite good.
Based on estimates for the next years, ALC will show a small growth in Revenue. The Revenue will grow by 6.10% on average per year.
EPS Next Y12.72%
EPS Next 2Y14.1%
EPS Next 3Y13.77%
EPS Next 5Y11.48%
Revenue Next Year4.86%
Revenue Next 2Y5.64%
Revenue Next 3Y6.05%
Revenue Next 5Y6.1%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
ALC Yearly Revenue VS EstimatesALC Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 5B 10B 15B
ALC Yearly EPS VS EstimatesALC Yearly EPS VS EstimatesYearly EPS VS Estimates 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 1 2 3 4

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5

4. Valuation

4.1 Price/Earnings Ratio

ALC is valuated quite expensively with a Price/Earnings ratio of 29.32.
Compared to the rest of the industry, the Price/Earnings ratio of ALC indicates a somewhat cheap valuation: ALC is cheaper than 78.42% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.29, ALC is valued at the same level.
ALC is valuated rather expensively with a Price/Forward Earnings ratio of 24.82.
ALC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ALC is cheaper than 77.37% of the companies in the same industry.
ALC's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.44.
Industry RankSector Rank
PE 29.32
Fwd PE 24.82
ALC Price Earnings VS Forward Price EarningsALC Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

81.58% of the companies in the same industry are more expensive than ALC, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ALC indicates a rather cheap valuation: ALC is cheaper than 81.58% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 36.35
EV/EBITDA 17.9
ALC Per share dataALC EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 10 20 30 40

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of ALC may justify a higher PE ratio.
ALC's earnings are expected to grow with 13.77% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.3
PEG (5Y)N/A
EPS Next 2Y14.1%
EPS Next 3Y13.77%

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3

5. Dividend

5.1 Amount

With a yearly dividend of 0.31%, ALC is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.64, ALC pays a better dividend. On top of this ALC pays more dividend than 91.05% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, ALC's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 0.31%

5.2 History

ALC has been paying a dividend for over 5 years, so it has already some track record.
The dividend of ALC decreased recently.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
ALC Yearly Dividends per shareALC Yearly Dividends per shareYearly Dividends per share 2021 2022 2023 2024 0.1 0.2 0.3 0.4

5.3 Sustainability

ALC pays out 11.20% of its income as dividend. This is a sustainable payout ratio.
DP11.2%
EPS Next 2Y14.1%
EPS Next 3Y13.77%
ALC Yearly Income VS Free CF VS DividendALC Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 0 500M -500M
ALC Dividend Payout.ALC Dividend Payout, showing the Payout Ratio.ALC Dividend Payout.PayoutRetained Earnings

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ALCON INC

NYSE:ALC (1/21/2025, 8:04:00 PM)

After market: 88.54 0 (0%)

88.54

+4.17 (+4.94%)

Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)11-12 2024-11-12/amc
Earnings (Next)N/A N/A
Inst Owners65.85%
Inst Owner Change-0.96%
Ins Owners0.12%
Ins Owner ChangeN/A
Market Cap44.24B
Analysts80
Price Target102.49 (15.76%)
Short Float %0.62%
Short Ratio3.34
Dividend
Industry RankSector Rank
Dividend Yield 0.31%
Yearly Dividend0.24
Dividend Growth(5Y)N/A
DP11.2%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.1%
Min EPS beat(2)0.51%
Max EPS beat(2)7.68%
EPS beat(4)4
Avg EPS beat(4)3.83%
Min EPS beat(4)0.51%
Max EPS beat(4)7.68%
EPS beat(8)6
Avg EPS beat(8)3.76%
EPS beat(12)9
Avg EPS beat(12)6.06%
EPS beat(16)12
Avg EPS beat(16)6.01%
Revenue beat(2)0
Avg Revenue beat(2)-2.69%
Min Revenue beat(2)-2.97%
Max Revenue beat(2)-2.41%
Revenue beat(4)0
Avg Revenue beat(4)-2.2%
Min Revenue beat(4)-2.97%
Max Revenue beat(4)-1.44%
Revenue beat(8)2
Avg Revenue beat(8)-1.19%
Revenue beat(12)4
Avg Revenue beat(12)-0.24%
Revenue beat(16)7
Avg Revenue beat(16)0.3%
PT rev (1m)-1.95%
PT rev (3m)-4.17%
EPS NQ rev (1m)-1.04%
EPS NQ rev (3m)-12.25%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.31%
Revenue NQ rev (1m)-0.4%
Revenue NQ rev (3m)-2.2%
Revenue NY rev (1m)-0.68%
Revenue NY rev (3m)-0.61%
Valuation
Industry RankSector Rank
PE 29.32
Fwd PE 24.82
P/S 4.53
P/FCF 36.35
P/OCF 21.38
P/B 2.07
P/tB 11.85
EV/EBITDA 17.9
EPS(TTM)3.02
EY3.41%
EPS(NY)3.57
Fwd EY4.03%
FCF(TTM)2.44
FCFY2.75%
OCF(TTM)4.14
OCFY4.68%
SpS19.53
BVpS42.8
TBVpS7.47
PEG (NY)2.3
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 3.82%
ROE 5.43%
ROCE 4.71%
ROIC 3.41%
ROICexc 3.63%
ROICexgc 11.14%
OM 13.47%
PM (TTM) 11.89%
GM 55.47%
FCFM 12.47%
ROA(3y)1.93%
ROA(5y)0.3%
ROE(3y)2.79%
ROE(5y)0.43%
ROIC(3y)2.4%
ROIC(5y)N/A
ROICexc(3y)2.52%
ROICexc(5y)N/A
ROICexgc(3y)8.83%
ROICexgc(5y)N/A
ROCE(3y)3.32%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y32.27%
ROICexc growth 3YN/A
ROICexc growth 5Y41.77%
OM growth 3YN/A
OM growth 5Y35.03%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y7.1%
GM growth 5Y2.18%
F-Score8
Asset Turnover0.32
Health
Industry RankSector Rank
Debt/Equity 0.23
Debt/FCF 4.2
Debt/EBITDA 1.94
Cap/Depr 69.27%
Cap/Sales 8.73%
Interest Coverage 7.15
Cash Conversion 81.3%
Profit Quality 104.82%
Current Ratio 2.57
Quick Ratio 1.6
Altman-Z 4.42
F-Score8
WACC4.7%
ROIC/WACC0.73
Cap/Depr(3y)92.06%
Cap/Depr(5y)71.71%
Cap/Sales(3y)12.45%
Cap/Sales(5y)10.93%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)22.27%
EPS 3Y38.11%
EPS 5YN/A
EPS Q2Q%22.73%
EPS Next Y12.72%
EPS Next 2Y14.1%
EPS Next 3Y13.77%
EPS Next 5Y11.48%
Revenue 1Y (TTM)5.25%
Revenue growth 3Y11.43%
Revenue growth 5Y5.74%
Sales Q2Q%5.64%
Revenue Next Year4.86%
Revenue Next 2Y5.64%
Revenue Next 3Y6.05%
Revenue Next 5Y6.1%
EBIT growth 1Y42.16%
EBIT growth 3YN/A
EBIT growth 5Y42.78%
EBIT Next Year59.43%
EBIT Next 3Y25.09%
EBIT Next 5Y18.14%
FCF growth 1Y2095.08%
FCF growth 3Y27.85%
FCF growth 5Y4.56%
OCF growth 1Y64.34%
OCF growth 3Y19.03%
OCF growth 5Y4.02%