10 Eyecare Stocks with Upside Potential
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In this piece, we will take a look at the ten eyecare stocks with upside potential. For more stocks, head on over to 5 Eyecare Stocks with Upside Potential.
One sector that has massively benefited from the advances in technology is healthcare. In just a century, humans have gone from struggling with basic diseases such as hypertension to combating some of the deadliest diseases known to mankind such as cancer. This growth in the healthcare segment's prowess has also enabled doctors and researchers to make detailed images of complex human body organs such as the eye.
After the brain, the human body's most complex organ is the eye. The eye is capable of discerning a whopping 10 million colors, blinks millions of times each year, have a whopping 100 million rod cells that enable night vision, and the eyes are capable of differentiating between a stunning 500 shades of gray.
At the same time, this complexity of the human eye also leads to a variety of diseases that are different from those faced by the body. After all, while a variety of muscles can spasm, no muscle ever suffered from a cataract. According to the Centers for Disease Control (CDC), 4.2 million Americans are that are older than 40 years are at least legally blind, with the majority of these problems caused by age related macular degeneration. The leading cause of vision loss in the U.S. is cataracts, which, unlike macular degeneration, can occur in individuals falling in any age group. While 4.2 million Americans older than 40 face macular degeneration, a startingly higher number, 20.5 million, suffer from cataracts. In fact, the number of those who have had at least one lens removed due to cataracts sits at 6.1 million - indicating that eye diseases continue to be a big problem in American healthcare.
Since we're on the topic of cataracts, data from the U.S. National Eye Institute shows that the number of people with cataracts in2050 is estimated to sit at 50 million in 2050 - more than doubling from the 24 million patients in 2010. And where there's a disease, there's a market willing to meet their needs. On this front, data from Healio shows that the cataract surgery industry will grow at a compounded annual growth rate (CAGR) ranging between 3% to 4% for the next three decades. This implies that in a little over two decades there will be approximately eight million cataract surgeries in the U.S., and the research report also adds that should resources allow, then the figure can swell to a whopping 100 million cataract surgeries in a year by 2050. However, while logic would suggest that the growth in surgeries would be accompanied by a growth in surgeons, Healio also adds that in the future, i.e. by 2030, less than 10,000 surgeons will perform 6 million surgeries per year, for roughly 600 surgeries per surgeon per year. This will mark a 200 million growth over the 400 million surgeries that 10,000 surgeons had performed in 2021.
Finally, the eye health market itself is of several different kinds. One of the largest of these is the broader eyecare market which was worth $6.6 billion in 2021 according to a research report from Reports and Data. From this, the firm expects the market to grow at a 3.8% CAGR to 2030, and be worth an estimated $42.5 billion by the end of the forecast period. The research firm believes that one of the primary drivers of growth in this market is the growth in screen time for both younger and older adults, especially since computer screens and other products are regularly used for a wide variety of uses including entertainment and work. It shares that the intraocular lens product segment constituted the largest part of the market in 2019, and it will continue to do so by the end of 2030, as it will account for 45.2% of the overall market. The popularity of intraocular lenses is due to the simple fact that they allow people with vision impairments to avoid wearing glasses after their surgeries, and since they can treat a range of eye diseases such as astigmatism, farsightedness, and nearsightedness. Segmenting the region geographically, Reports and Data adds that North America was the world's largest eyecare products market, with a wider prevalence of eye diseases in China driving growth in Asia.
The growth in screen use globally is confirmed when we take a look at the latest earnings call transcript from The Cooper Companies, Inc. (NYSE:COO). In its analyst conference for the first quarter of the fiscal year of 2023, the company's chief executive officer and president Mr. Al White shared:
Studies show that adults are now spending more than seven hours a day on screens, resulting in eye ceiling strain and discomfort. Energys, with its boost technology is the perfect solution to address this digital eye fatigue. And our survey work clearly shows that practitioners and customers are excited to get this technology and a daily offering. All this MyDay activity is exciting, and we remain dedicated to developing and rolling out technologically superior MyDay products for many years to come. Lastly, within the daily segment, Clarity is performing well. Its mass market price point is allowing eye care practitioners to continue utilizing the Clarity franchise as a great way to bring wares into the daily silicone hydrogel space. Moving outside of dailies.
Today, we'll look at some great eyecare stocks in terms of analyst upside. Out of these, some picks are EyePoint Pharmaceuticals, Inc. (NASDAQ:EYPT), OKYO Pharma Limited (NASDAQ:OKYO), and Kala Pharmaceuticals, Inc. (NASDAQ:KALA).
Our Methodology
We took a broad look at the healthcare sector to narrow down those firms that also offer eyecare products. Then, we researched to determine if their consensus share price target estimates are higher than the current share price. The companies that had the highest share price upside were selected, and out of these ten firms are chosen. These companies are ranked according to their market capitalization, starting from the most valuable company at number ten.
10 Eyecare Stocks with Upside Potential
10. Novartis AG (NYSE:NVS)
Latest Market Capitalization: $173 billion
Novartis AG (NYSE:NVS) is a Swiss healthcare company headquartered in Basel, Switzerland. The company makes and sells eye drops for problems such as inflammation and swelling in the back of the eye. Apart from this, the firm also makes other drugs such as those that target cancer and heart problems.
By the end of last year's fourth quarter, 22 of the 943 hedge funds polled by Insider Monkey had held a stake in Novartis AG (NYSE:NVS). Out of these, the firm's largest investor is Peter Rathjens, Bruce Clarke, and John Campbell's Arrowstreet Capital which owns 4.1 million shares that are worth $374 million.
Along with OKYO Pharma Limited (NASDAQ:OKYO), EyePoint Pharmaceuticals, Inc. (NASDAQ:EYPT), and Kala Pharmaceuticals, Inc. (NASDAQ:KALA), Novartis AG (NYSE:NVS) is an eyecare stock with high upside potential.
9. Centene Corporation (NYSE:CNC)
Latest Market Capitalization: $35.8 billion
Centene Corporation (NYSE:CNC) is a healthcare coverage plan provider. It enables customers to take eye exams and buy eye care products such as glasses, lenses, contacts, and other products. The firm is headquartered in Saint Louis, Missouri.
Insider Monkey took a look at 943 hedge funds for last year's fourth quarter and found out that 58 had invested in Centene Corporation (NYSE:CNC). Out of these, Quentin Koffey's Politan Capital is the firm's largest investor since it owns 13.1 million shares that are worth $1 billion.
8. Alcon Inc. (NYSE:ALC)
Latest Market Capitalization: $33.8 billion
Alcon Inc. (NYSE:ALC) is one of the more well known eye care product providers. The firm is headquartered in Geneva, Switzerland, and it a variety of products such as intraocular lenses, surgical packs, microscopes, visualization systems, and medicines to relieve symptoms of eye diseases such as glaucoma and allergies. Its product portfolio makes it a great eye care stock.
Alcon Inc. (NYSE:ALC)'s shares currently trade around $67, while its average analyst price target is $84. As of December 2022, 26 of the 943 hedge funds polled by Insider Monkey had invested in the company. Alcon Inc. (NYSE:ALC)'s largest shareholder is Nicolai Tangen's Ako Capital which owns 5.6 million shares that are worth $385 million.
7. The Cooper Companies, Inc. (NYSE:COO)
Latest Market Capitalization: $17.2 billion
The Cooper Companies, Inc. (NYSE:COO) is an American firm headquartered in San Ramon, California. The firm primarily focuses on making and selling contact lenses for eye problems such as farsightedness, nearsightedness, astigmatism, and other problems.
The Cooper Companies, Inc. (NYSE:COO)'s shares currently trade at around $348, with the average analyst share price target being $372. Insider Monkey's Q4 2022 survey of 943 hedge funds revealed that 37 had held a stake in the firm. The Cooper Companies, Inc. (NYSE:COO)'s largest investor is Parag Vora's HG Vora Capital Management which owns 3.4 million shares that are worth $138 million.
6. Bausch + Lomb Corporation (NYSE:BLCO)
Latest Market Capitalization: $5.6 billion
Bausch + Lomb Corporation (NYSE:BLCO) is another renowned eyecare firm that is known for its products such as contact lenses, eye drops, eye vitamins, and more. The firm is based in Vaughan, Ontario, Canada.
As of December 2022, 27 of the 943 hedge funds surveyed by Insider Monkey had invested in Bausch + Lomb Corporation (NYSE:BLCO). The firm has an average analyst share price target of $28.7, higher than its current share price.
Along with, EyePoint Pharmaceuticals, Inc. (NASDAQ:EYPT), OKYO Pharma Limited (NASDAQ:OKYO), and Kala Pharmaceuticals, Inc. (NASDAQ:KALA) Bausch + Lomb Corporation (NYSE:BLCO) is an eyecare stock with a significant share price upside.
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Disclosure: None. The author received no additional compensation for this piece except for what is typically made by Insider Monkey. 10 Eyecare Stocks With Upside Potential is originally published on Insider Monkey.