Alcon’s ALC Vision Care business continues to gain from its diverse portfolio of contact lenses and ocular health products. Growth momentum within the Surgical business is poised to boost the top line in the upcoming quarters. Meanwhile, adverse macroeconomic conditions and intense competition may harm the company’s operations.
In the past year, this Zacks Rank #3 (Hold) stock has dipped 22.3% compared with the industry’s 7.3% decline. The S&P 500 composite has risen 31.8% in the same time frame.
The renowned pharmaceutical and medical device manufacturer has a market capitalization of $32.77 billion. ALC’s earnings surpassed estimates in three of the trailing four quarters and missed in one, delivering an average surprise of 3.7%.
Let’s delve deeper.
Upsides for ALC
Surgical Business Momentum: Alcon continues to refresh its cataract workflow and intraocular lens lineup, which supports share gains even as procedure growth remains uneven. In the first quarter of 2026, Surgical sales were $1.46 billion, up 6% at constant currency, with equipment up 23% and supported by the recent Unity launch.
Management highlighted expansion of the Unity installed base and pointed to a strong post-ASCRS order pipeline, which should support equipment growth as more sites convert. Consumables sales were up 4% at constant currency, aided by price increases despite softer cataract market conditions.
Within implantables, first-quarter sales were $438 million, up 1% at constant currency, reflecting the U.S. performance of PanOptix Pro and competitive pressures internationally. The company also launched TruPlus with a toric option, which broadens its monofocal plus offering.
Vision Care Returns to Growth: Vision Care continues to benefit from a shift toward newer contact lens offerings and expansion in dry eye, which supports a steadier growth profile over time.
In the first quarter of 2026, Vision Care sales were $1.23 billion, up 6% at constant currency, with contact lenses up 4% and ocular health up 10% at constant currency. After expanding the TOTAL 30 family last year to cover all major modalities — sphere, toric and multifocal — in February 2026, the company introduced a multifocal toric lens for presbyopes patients with astigmatism.
Alcon’s PRECISION7 remains a key weekly platform for patients who are not candidates for daily disposables. In ocular health, Systane delivered high single-digit growth in the quarter, and multi-dose preservative-free formats grew more than 20% year over year.
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Downsides for ALC
Macroeconomic Pressure Stays: Alcon remains exposed to geopolitical and trade volatility that can disrupt supply chains and raise input costs, particularly as tariffs continue to evolve. In the first quarter of 2026, incremental tariffs in the U.S. and China totaled $33 million, and management cited a 120 basis points drag on core gross margin. For 2026, management’s outlook assumes a net tariff impact of about $100 million to $150 million and excludes any potential refunds.
The company disclosed that it has paid approximately $64 million under invalidated IEEPA tariffs, though no refunds have been recorded due to uncertainty surrounding timing and recoverability.
Tough Competitive Landscape: Competition remains intense across both segments and is showing up most clearly where Alcon is defending share outside the United States and managing mix transitions. In the first quarter of 2026, implantables grew 1% at constant currency as PanOptix Pro's strength was offset by competitive pressure in international markets and lower sales in surgical glaucoma. In Vision Care, contact lenses grew 4% at constant currency, but management cited declines in legacy products as it reduced promotional activity.
ALC Stock Estimate Trend
The Zacks Consensus Estimate for 2026 earnings per share has moved north 2 cents to $3.48 in the past 30 days.
The Zacks Consensus Estimate for 2026 revenues is pegged at $11.05 billion, suggesting a 7.1% rise from the year-ago reported number.
Key Picks
Some better-ranked stocks in the broader medical space are Globus Medical GMED, Integra LifeSciences IART and Phibro Animal Health PAHC.
Globus Medical has an earnings yield of 5.5%, well ahead of the industry’s -3% yield. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 26.3%. The company’s shares have rallied 43.8% against the industry’s 4.8% decline over the past year.
GMED sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Integra LifeSciences, carrying a Zacks Rank #2 (Buy) at present, has an earnings yield of 16% against the industry’s -3% yield. Shares of the company have gained 22.8% compared with the industry’s 4.8% growth. IART’s earnings topped estimates in each of the trailing four quarters, the average surprise being 16.8%.
Phibro Animal Health, carrying a Zacks Rank #2 at present, has an earnings yield of 9.2% compared with the industry’s 2.8% yield. Shares of the company have climbed 43.1% against the industry’s 27.9% decline. PAHC’s earnings beat estimates in each of the trailing four quarters, the average surprise being 16.3%.
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Integra LifeSciences Holdings Corporation (IART): Free Stock Analysis Report
Alcon (ALC): Free Stock Analysis Report
Globus Medical, Inc. (GMED): Free Stock Analysis Report
Phibro Animal Health Corporation (PAHC): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).