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Bausch Health (BHC) Hits A New High, What Next?

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Shares of Bausch Health Companies Inc. (BHC) (BHC.TO), which are up 55 percent year-to-date, closed at an all-time high of $28.68 yesterday.

Bausch Health, formerly known as Valeant Pharmaceuticals International Inc., manufactures and markets a broad range of pharmaceutical, medical device and over-the-counter products, primarily in the therapeutic areas of eye health, gastroenterology, and dermatology.

The Company's products fall under four segments - Bausch + Lomb/International, Salix, Ortho Dermatologics and Diversified products.

In the third quarter ended September 30, 2019, the results of which were announced last month, the net loss shrunk to $49 million or $0.14 per share on revenue of $2.209 billion. This compared with a net loss of $350 million or $1.00 per share and revenue of $2.136 billion in the year-ago quarter. The Company attributed the narrower loss to a decrease in amortization and impairments and the increase in reported revenues and higher gross margins in 2019.

Looking ahead to full-year 2019, the Company expects revenue to range between $8.475 billion and $8.625 billion. Revenue in 2018 was $8.380 billion.

The Bausch + Lomb/International segment contributes to a major chunk of the Company's total revenue, followed by Salix, Diversified products and Ortho Dermatologics segments.

The New Drug Application for ARAZLO (IDP-123) Lotion for the treatment of acne, submitted by the Ortho Dermatologics segment of the Company is under FDA review, with a decision expected by December 22, 2019.

If approved, ARAZLO will be the first tazarotene acne treatment available in a lotion form. Tazarotene, a member of the acetylenic class of retinoids, is available as a cream, gel, or foam.

BHC has traded in a range of $17.20 to $29.03 over the last 1 year. The stock closed Wednesday's trading at $28.68, up 1.45%.

H.C. Wainwright analyst Raghuram Selvaraju now has a price target of $60 for BHC, up from his previous target of $54.

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