Inflationary Factors And Slow Product Uptake Could Be Headwinds For Bausch + Lomb, Analyst Says - Bausch & Lomb (NYSE:BLCO)

H.C. Wainwright analyst Yi Chen reiterated a Buy rating on the shares of Bausch + Lomb Corporation BLCO, lowering the price target to $19 from $21.
While eye care market demand could remain strong to drive the company's top-line growth in the quarters ahead, Yi Chen remains particularly cautious about the company's soaring selling, general and administrative expenses.
In the just-reported first quarter of FY23 results, Bausch +Lomb's SG&A expenses stood at $418 million (+21.9% year over year), driven by higher selling expenses due to inflationary factors, mostly in freight and distribution.
Going ahead, the analyst expects SG&A expenses to remain at a higher level due to inflation.
This apart, lower-than-projected uptake of products and the inability to develop and secure regulatory approval of additional products may be potential headwinds.
The analyst cautioned that the company may also face fluctuating sales in emerging markets and foreign exchange rates.
Price Action: BLCO shares are trading higher by 3.71% to $18.15 on the last check Monday.