Public reading · as of 2026-07-12 · educational, not investment advice
SEC filer matched (CIK 885590): fundamentals read from the company's filings rather than the market-data provider.
What this company does
Bausch Health Companies operates in the healthcare sector, developing and selling pharmaceutical products and medical devices. The company generates revenue through prescription drugs, over-the-counter products, and medical devices across multiple therapeutic categories including gastrointestinal, neuroscience, dermatology, and generics, selling primarily through wholesalers and distributors to healthcare providers and patients.
From the company’s latest 10-K · 2026-02-19, paraphrased.
Tap any ? to learn what it means and how it’s calculated.
Three-lens reading
Value sees an extreme discount pricing debt distress and potential equity wipeout; Quality sees real operational improvement (net margin +22 points, CAD 1.4B FCF) but a balance sheet dominated by CAD 27.5B net debt (10.9× EBITDA) that consumes all the cash; Growth sees a decade of stagnation (0.7% CAGR) with a recent 6.7% uptick that may or may not mark a turn—the market is betting the equity stub survives deleveraging, but the flat revenue trend and heavy debt service make that a tail-risk play rather than a quality compounder.
Deeply discounted debt story
Is it cheap for what you get?
On balance, the price implies the market sees this primarily as a levered debt story rather than an equity claim on future cash flows. The P/S 0.17 and enterprise value 11.9× EBITDA frame the business as a cash-flow asset servicing a debt load, with equity holders absorbing residual risk. The turn to positive net income (CAD 222M in 2025 vs. CAD −2.5B in 2019) and steady 10% FCF margin show operating improvement, but the CAD 27.5B net debt (10.9× EBITDA) and negative equity mean the valuation hinges on whether the company can delever without wiping out equity. The 27% dividend yield is unsustainable given the −40% payout ratio on negative TTM earnings, likely a legacy artifact rather than a signal of value.
Essentially flat
How fast and durably is it expanding?
On balance, the growth picture is one of stabilization rather than expansion, with the flat long-term trend outweighing the recent 6.7% uptick. Revenue grew 0.7% annually from 2016 to 2025, rising from CAD 13.7B to CAD 14.5B, and the latest year-over-year growth of 6.7% is the first material acceleration in the series—but one year does not establish a trend. The business spans gastrointestinal (Salix), neuroscience, dermatology, generics, international, and Bausch + Lomb (vision care, surgical, pharmaceuticals), yet the consolidated result has been near-zero growth for a decade, typical of a mature specialty pharma portfolio. The news notes Quebec's listing of OKEDI (schizophrenia injectable) and a glaucoma Phase 2 result, both early signals, but neither large enough to move the revenue needle materially yet.
Improving but capital-constrained
How profitable, sound and well-run is it?
On balance, the business has demonstrably improved its profitability and cash generation, but the capital structure remains heavily burdened, leaving little room for missteps. Net margin swung from −21% (2019) to +1.5% (2025), a 22-percentage-point improvement, and the company is now generating CAD 1.4B in free cash flow (10% margin, down from 19% in 2016 but stable in recent years). Gross margin is a healthy 77%, and ROCE improved from near-zero in 2017 to 8% in 2025, though this still reflects low returns on a large capital base (total assets CAD 34.7B, much of it goodwill CAD 13.9B and intangibles CAD 6.2B). The constraint is the balance sheet: net debt CAD 27.5B is 10.9× EBITDA, interest expense CAD 2.4B covers operating income only 0.35×, and equity is CAD −2.9B. The current ratio of 1.32 and cash CAD 1.8B (0.29× current liabilities) provide modest near-term liquidity, but the debt load dominates the financial profile. The 27% dividend yield is a red flag, not a feature—it reflects a −40% payout ratio on negative TTM earnings, mechanically unsustainable.
💡Worth knowing▾
Net debt 10.9× EBITDA (CAD 27.5B ÷ CAD 2.5B) means deleveraging is a multi-year grind even if all free cash flow goes to debt paydown—at CAD 1.4B FCF annually, net debt falls ~5% per year, making this a slow turnaround story rather than a quick delever.
Interest coverage of 0.35× (operating income CAD 831M vs. interest CAD 2.4B) means the business cannot service its debt from operations, relying on asset sales, refinancing, or free cash flow to cover the shortfall—this is the structural reason equity is subordinated and the valuation is so low.
The 10% FCF margin (CAD 1.4B on CAD 14.9B revenue) is the lifeline for deleveraging: it funds debt paydown and keeps the business solvent. The margin has fallen from 19% in 2016, partly due to higher capex or working-capital needs, but has stabilized in recent years—watch whether it holds or compresses further under the debt load.
Negative equity (CAD −2.9B) makes P/B, ROE, and debt-to-equity ratios meaningless—you're valuing the business on cash flow and enterprise value (CAD 30.1B), not book value. Equity holders are subordinated to debt and have a claim only if the business generates enough cash to delever or grow its way out of the hole.
The business has turned from multi-billion-dollar losses to profitability (net income CAD 222M in 2025 vs. CAD −2.5B in 2019, a 22-percentage-point margin improvement) while maintaining CAD 1.4B in free cash flow (10% margin) and a 77% gross margin, proving the operating model works. Revenue grew 6.7% year-over-year, the strongest uptick in a decade, and new products like OKEDI (now listed in Quebec) and the Bausch + Lomb glaucoma pipeline offer paths to reacceleration. The CAD 27.5B net debt (10.9× EBITDA) is the legacy burden, but if revenue growth holds and margins expand modestly (from 1.5% net to 3–5%), the business generates enough cash to delever materially over 5–7 years, leaving equity holders with a profitable, lower-leverage specialty pharma franchise trading at only 0.17× sales today. The market is pricing this as if equity gets wiped out, but the operational turn is real—the setup is a deep-value bet on survival and deleveraging, not a broken business.
The CAD 27.5B net debt burden (10.9× EBITDA) and 0.35× interest coverage mean the business cannot cover its debt service from operating income, leaving equity as a residual claim that could be wiped out in any refinancing or restructuring. Revenue has been flat for a decade (0.7% CAGR 2016–2025), and the recent 6.7% uptick is one year—not yet a proven trend—while the operating cost base of CAD 14.1B leaves little margin for error (the business is only 5.6% above operating breakeven). The negative CAD 2.9B shareholder equity and CAD 20.1B in goodwill/intangibles (58% of assets) expose the balance sheet to impairment risk if cash flow stumbles. The 27% dividend yield is unsustainable noise (−40% payout ratio on negative TTM earnings), not a return. Even if the turnaround holds, deleveraging at CAD 1.4B FCF per year is a 19-year slog to clear the net debt, and any misstep—revenue decline, margin compression, covenant breach—likely triggers dilution or a restructuring that leaves current equity holders with little or nothing. The P/S 0.17 is pricing exactly that tail risk, and the facts do not yet prove it wrong.
- Revenue growth holds near the recent 6.7% (vs. the 0.7% long-term CAGR), or the business cannot outgrow the debt burden—stagnation leaves equity subordinated indefinitely.
- Free cash flow margin stays above ~10% (now 9.8%), generating CAD 1.4B+ annually to service debt and avoid liquidity stress; a margin slip below 8% would materially slow deleveraging.
- The debt structure remains refinanceable and the business avoids covenant breaches, given interest coverage of only 0.35× (interest CAD 2.4B vs. operating income CAD 831M)—a stumble in cash generation could force a restructuring that dilutes or wipes out equity.
- Net margin improves from today's 1.5% toward mid-single-digits (3–5%) to demonstrate the turn to profitability is durable and margin expansion can offset the flat revenue trend—backsliding to breakeven or losses would validate the distressed-debt framing.
- Revenue growth decelerates back toward the 0.7% long-term trend or turns negative, confirming the recent 6.7% uptick was transient and the business cannot outgrow the debt burden—this would validate the distressed-debt framing and likely pressure the equity stub toward zero.
- Net margin or free cash flow margin contracts materially (net margin falls below 0%, FCF margin below 8%), signaling the operational turn is reversing—this would raise liquidity and covenant risk, likely forcing a debt restructuring that dilutes or wipes out equity.
- The company announces a debt restructuring, covenant waiver, or equity raise to address the CAD 27.5B net debt and 0.35× interest coverage—this would likely massively dilute existing shareholders or convert debt to equity, confirming the bear case that equity is subordinated.
- Sustained multi-year revenue growth above 10% and net margin expansion to mid-single-digits (3–5%) demonstrate the business is reaccelerating and can materially delever within 5–7 years—this would shift the narrative from distressed-debt to operational turnaround and support a much higher equity valuation.
What to watch
| Signal | What to watch for | Where it stands |
|---|---|---|
| TailwindGrowth | ||
| Q2 2026 results (July 29): revenue growth and margin trajectory—if the 6.7% growth holds or accelerates and net margin improves from 1.5%, the operational turn is real; if growth fades back toward the 0.7% long-term trend or margins compress, the recent uptick was noise. | Revenue growth holds near or above 6.7%, net margin improves above 2% | 6.7% revenue growth year-over-year now, net margin 1.5% now Bausch Health to Announce Second Quarter 2026 Results on July 29, 2026 ↗ |
| TailwindGrowth | ||
| OKEDI uptake and Bausch + Lomb pipeline progress: if the Quebec listing drives material OKEDI revenue or the glaucoma Phase 2 leads to approval and launch, the product portfolio can drive growth; if uptake is slow or the pipeline stalls, the flat revenue trend persists. | OKEDI revenue ramps materially in Canadian market, glaucoma candidate advances to Phase 3 or approval | OKEDI listed in Quebec June 25, 2026; glaucoma Phase 2 results announced July 9, 2026 Québec is the first province to list Pr OKEDI MC (extended-release ...) ↗ |
| Watch-outQuality | ||
| Free cash flow generation: if FCF margin holds near 10% (CAD 1.4B+ annually), the business can service debt and delever slowly; if FCF falls below CAD 1.0B (margin <7%), liquidity stress rises and a restructuring becomes likely. | FCF margin holds above 9%, generating CAD 1.4B+ annually | CAD 1.4B FCF now (9.8% margin) |
| Watch-outValue | ||
| Debt refinancing and covenant compliance: with interest coverage 0.35× (interest CAD 2.4B vs. operating income CAD 831M) and net debt 10.9× EBITDA, any covenant breach or inability to refinance maturing debt likely forces a restructuring that dilutes or wipes out equity. | Debt refinanced without covenant breach or equity dilution | Net debt CAD 27.5B (10.9× EBITDA), interest coverage 0.35× |
Research and education, not investment advice. AI-generated and may contain errors — verify against primary sources before relying on it; Navam Digital is not responsible for decisions made from this output. The reading is grounded in the facts below; you make the decision. Generated by Sonnet, with recent news.
Peers
suggested comparablesSuggested from sector and business model. Each ticker is verified against exchange listings.
Comparables are suggested by industry, business model, and available filings. They are not investment recommendations, and may differ in size, capital structure, or valuation.
- JWELJamieson Wellness Inc.
Recent news
8 headlinesBausch Health Companies Inc. announced on July 6, 2026, that Quebec became the first Canadian province to list its extended-release injectable schizophrenia treatment OKEDI in the provincial drug formulary, securing reimbursement for the 75 mg and 100 mg strengths effective June 25. The company also confirmed on July 7 that it will release second-quarter 2026 financial results after market close on Wednesday, July 29, 2026, followed by a live conference call at 5:00 p.m. EDT to discuss the results and provide a business update. No other material developments such as contract wins, product launches, or regulatory actions were reported for BHC in the past week.
Recent coverage feeding the reading above. Links open the source.
- Bausch + Lomb Announces Phase 2 Results for Glaucoma ... ↗
- Employee Benefits - Bausch + Lomb ↗
- Bausch Health Companies Stock Forecast - StockInvest.us ↗
- Bausch Health Companies Inc. (BHC.TO) Buy,… - Stockchase ↗
- Bausch Health to Announce Second Quarter 2026 Results on July ... ↗
- Bausch + Lomb Will Release Second-Quarter 2026 Financial ... ↗
- Québec is the first province to list Pr OKEDI MC (extended-release ... ↗
- Bausch Health vs. Taro: Psoriasis Patent Dispute Ends in Consent ... ↗
Company filings
1 in the last monthMaterial events filed with the SEC (Form 8-K) — disclosed by the company. Read alongside, not in place of, independent coverage.
Financials
Prices are end-of-day; fundamentals come from the company's latest SEC filings and each carries its own as-of date (shown per row), so they are not as current as the price. Tags: SEC straight from the filing, computed derived by ThreeLens from filed figures, market from a market-data feed.
Bausch Health Companies Inc. reports its financial statements in USD but trades in CAD. Filed figures and the multi-year trends have been restated into CAD at a single rate of 1.41578 CAD per USD. Growth rates, margins and returns are unaffected by the restatement; absolute levels for earlier years are shown at today's rate, not the rate that prevailed in those years.
Ratios — computed from filings + price
Trends — from filings
How the business has moved over time. Hover or tap a point for its exact value; tap a chart to expand it.
TTM = trailing twelve months — the last four quarters, kept current. Tap to learn more.
Sources
Compiled from 9 public sources — filings and recent news, not analyst opinion. Fundamentals are from SEC EDGAR; market data via Twelve Data.