Alcon Inc. (ALC)
OvervaluedFundamental
68
Price
$64.11
Market Cap
$30.99B
Part 1 · What the company is worth
Overview
Alcon makes products for eye care: surgical equipment and disposable supplies used in cataract and vitreoretinal operations, plus contact lenses and eye drops sold over the counter and through optometrists. Spun off from Novartis in 2019 and domiciled in Switzerland, it is one of the largest companies focused solely on the eye, selling to surgeons, hospitals and eye-care practitioners worldwide.
How it makes money
The Surgical segment follows a razor-and-blade pattern: Alcon sells or places a surgical console or laser once, then earns recurring revenue for years from the consumables, lenses and service that surgeons must keep buying to use it. Vision Care behaves more like a consumer-health business, with contact lenses and eye drops repurchased regularly through optometrists and retail.
Revenue by segment
Cataract and vitreoretinal surgical equipment, intraocular lenses (implantables) and the consumables surgeons use with them.
Contact lenses and ocular-health products such as lubricating eye drops, sold through optometrists and retail rather than surgeons.
Competitive moat
Switching costs · NarrowOnce a surgical practice is set up around Alcon's consoles, lens formulas and diagnostic tools, moving to a rival platform means retraining staff and requalifying equipment, which keeps buyers locked into Alcon's consumables. The advantage is real but not exclusive: Johnson & Johnson Vision, Bausch + Lomb and Zeiss compete for the same installed-base strategy.
What drives demand
DefensiveMost Surgical revenue tracks cataract surgery volumes, which are driven by an aging population and are rarely postponable once vision is impaired, so demand holds up better than in most medtech categories during downturns. Vision Care is a bit more discretionary but still tied to a recurring need rather than a one-off purchase.
Key risks
- Reliance on single-source suppliers — The company relies on global supply chains and, for some components, on single-source suppliers; a disruption at one of them can halt production of a device or lens line with no quick substitute.
- Exposure to China and volatile markets — Alcon flags an increasingly challenging economic, political and legal environment in China as a risk factor, alongside broader exposure to currency and political volatility in the emerging markets where it sells.
- Cybersecurity and data privacy — The company cites cybersecurity and cloud-migration vulnerabilities, and the complexity of complying with data-privacy rules across the many jurisdictions where it operates, as ongoing risks to its business.
- Competition from large medtech rivals — Alcon competes against large, well-resourced eye-care and medical-device companies that can match its research spending and pursue the same installed-base strategy, pressuring both pricing and market share.
The case for
Buyers argue that Alcon's installed base of roughly 28,000 surgical systems locks in years of recurring consumables revenue, that cataract surgery demand is structurally supported by an aging population, and that new product launches keep growth ahead of the broader eye-care market.
The case against
Sellers fear that reliance on single-source suppliers and a difficult China environment could disrupt supply or demand with little warning, and that well-funded rivals pursuing the same installed-base strategy will eventually compress the pricing power that the consumables model depends on.
Written by the editors, published on August 18, 2026
Direct competitors
Who this company fights with for the same customers
Generated on August 23, 2026 with claude-opus-5 — shared with all users
Its Johnson & Johnson Vision arm is the other global player Alcon names in both surgical and vision care, competing directly on premium intraocular lenses and, with the Acuvue brand, on daily disposable contact lenses.
CooperVision is a pure contact-lens rival named by both companies in their annual reports, disputing the same spherical, toric and multifocal lens prescriptions through the same optician and optometrist channel.
Alcon names Bausch & Lomb as a primary competitor in both of its segments, so the two go head to head across cataract surgery equipment and intraocular lenses as well as contact lenses and eye drops sold to the same eye-care professionals.
Listed first among Alcon's surgical competitors, Zeiss sells the ophthalmic surgical platforms, refractive lasers and diagnostic systems that compete for the same capital budgets of cataract and refractive surgery clinics.
Hoya's Vision Care and medical divisions compete with Alcon on intraocular lenses implanted in cataract surgery, with particular strength in Japan and the rest of Asia.
Glaukos is the specialist rival Alcon names in surgical glaucoma, selling the micro-stents implanted during cataract surgery that compete directly with Alcon's own glaucoma devices for the same surgeons.
Balance Sheet & Liquidity
Revenue
$10.83B
Trailing 12 months to the last reported quarter — estimated from per-share metrics
Net Income
$636M
Trailing 12 months to the last reported quarter — estimated from per-share metrics
Free Cash Flow
$1.61B
Total Equity
$22.01B
Total Liabilities
$31.55B
Current Ratio
2.12
Interest Coverage
6.67
Debt/EBITDA
1.96
Earnings Per Share
Revenue & Net Income
Free Cash Flow
Income Breakdown
Historical statement
Margins over time
Debt over time
How heavy the debt is
Growth grid
Growth — Revenue
Fair Value Estimation
Fair Value
$50.63
Current Price
$64.11
Margin of Safety
-26.6%
Fair Value Range
$32.91 - $68.36
Spread across the valuation methods used, not a statistically calibrated confidence interval.
Estimation Methods
Valuation Metrics
P/E Ratio
49.17
ROE
4.5%
P/B Ratio
1.45
P/FCF
19.43
Gross Margin
59.6%
ROIC
3.8%
Profitability Radar
Value Creation (Economic Moat)
ROIC
3.8%
WACC
8.8%
ROIC − WACC
-5.0 pp
ROIC is below the cost of capital — the company is destroying value for every dollar invested.
Fundamental Analysis Criteria
Passed (17)
- EPS shows upward trend
- EPS CAGR 43.04%
- Gross margin 59.6%
- P/FCF 19.43
- P/B ratio 1.45
- Debt/equity ratio
- Operating margin 8.7%
- Positive free cash flow
- Current ratio
- Interest coverage
- Debt/EBITDA
- Revenue growth 5Y 8.8%
- Analyst consensus: 73% buy
- Earnings surprise, average 3.8%
- Earnings quality (operating cash flow / net income) 2.32
- Share dilution -0.3%
- Piotroski F-Score 6/9
Failed (7)
- Price CAGR 2.09%
- ROIC 3.8%
- CapEx intensity
- Price below Graham Number
- DCF valuation (Overvalued)
- ROE 2.9%
- Net margin trend 9.4% vs 10.3%
Unavailable (4)
- Dividend payout –
- Return on tangible assets
- Low reliance on intangibles
- PEG ratio (needs P/E > 0 and growth > 0)
Piotroski F-Score
Mixed signals: some areas need attention
Earnings Quality
High quality: earnings backed by cash
Share Dilution
Buying back shares. Shareholder friendly
Institutional Holdings
No institutional filings reported for this company.
Governance
Executive Team
| Name | Title | Age |
|---|---|---|
| Mr. David J. Endicott | CEO & Director | 60 |
| Mr. Timothy C. Stonesifer | Senior VP & CFO | 58 |
| Mr. Ian Bell | Senior VP & COO | 54 |
| Margaret Buckley | Chief Accounting Officer | - |
| Dr. Franck Leveiller Ph.D. | SVP of Global Research & Development and Chief Scientific Officer | - |
| Mr. Muru Murugappan | Senior VP and Chief Information & Transformation Officer | - |
| Mr. Daniel Cravens | Vice President of Investor Relations | - |
| Mr. Royce R. Bedward J.D. | Senior VP, General Counsel & Corporate Secretary | 59 |
| Ms. Kimberly Martin | Senior VP and Chief HR & Corporate Communications | 50 |
| Mr. Leon Sergio Duplan Fraustro | Senior VP & President of Americas | 57 |
Audit Risk
9
Board Risk
4
Compensation Risk
3
Shareholder Rights Risk
1
Part 2 · The price and when to enter
This part won't tell you whether the company is worth owning: it helps you choose when to buy it, once the fundamentals have convinced you. Inside: technical analysis, potential, historical drawdowns, gamma exposure.
Latest News
Recent headlines for ALC, sourced from Markets Gazette.
- 2/25/2026NEUTRALAlcon (ALC) Q4 2025 Earnings Call Transcript
Markets Gazette announces the availability of the Alcon (ALC) Q4 2025 earnings call transcript. This routine event for publicly traded companies provides investors and analysts with a detailed account of discussions between management and the financial community. While the specific content of the results and projections has not yet been disclosed in this announcement, the publication of the transcript is a crucial step for transparency and in-depth analysis of the company's performance. Market participants are now awaiting to examine the details to assess Alcon's financial health, future prospects, and potential impact on its stock price. The earnings call typically covers revenues, profits, margins, guidance, and future strategies, all critical elements for investment decisions.
via Markets Gazette