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Alcon's (ALC) Global Growth Solid, New Lenses Sales Rise

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Alcon Inc (ALC - Free Report) is witnessing a recovery in the Surgical and Vision Care businesses. The company’s focus on research and innovation is also encouraging. The stock currently carries a Zacks Rank #2 (Buy).

Alcon has outperformed the industry over the past year. The stock has rallied 8% versus the industry’s 4.8% decline.

The company reported better-than-expected results for third-quarter 2021. Year-over-year growth across all sales categories in Surgical and Vision Care was driven primarily by a rise in demand for new products, solid commercial execution and strong market recovery in the United States. Recovery in the international markets remains mixed. However, Alcon was encouraged to see signs of recovery in select European markets late in the quarter.

Segment-wise, in Surgical, the portfolio of advanced technology intraocular lenses has been driving increased penetration rates of ATIOLs and Alcon continues to see strong demand for cataract refractive equipment. In Vision Care, the company’s new contact lenses are gaining market share and the Systane brand family has been posting strong double-digit growth in all regions.

The margin improvements buoy optimism. Alcon’s guidance assumed the global markets to return to 2019 levels by the end of 2021. During the third-quarter earnings release, the company stated that the U.S. markets are expected to continue to grow above 2019 for the remainder of 2021, and the international markets as a whole are expected to reach 2019 levels early next year.

On the flip side, in the third quarter of 2021, in terms of end markets, within Surgical, excluding India, the global market was down mid-single-digits compared to 2019. The international markets were down in the high single digits, primarily due to emerging markets such as Japan, which continue to be suppressed. In Vision Care, international markets have not yet returned to 2019 levels.

While updating its 2021 guidance, Alcon had assumed that its international market would return to 2019 levels not before early 2022, with business in countries such as India and Japan remaining subdued.

Other Key Picks

A few other top-ranked stocks in the broader medical space include AMN Healthcare Services, Inc. (AMN - Free Report) , Apollo Endosurgery, Inc. (APEN - Free Report) and Laboratory Corporation of America Holdings (LH - Free Report) .

AMN Healthcare, carrying a Zacks Rank #1 (Strong Buy), has a long-term earnings growth rate of 16.2%. The company surpassed earnings estimates in the trailing four quarters, delivering a surprise of 19.5%, on average. You can see the complete list of today's Zacks #1 Rank stocks here.

AMN Healthcare has outperformed its industry over the past year. AMN has gained 46.5% versus the 57.2% industry decline.

Apollo Endosurgery, carrying a Zacks Rank #2, has a long-term earnings growth rate of 7%. The company‘s earnings surpassed estimates in the trailing four quarters, delivering a surprise of 25.6%, on average.

Apollo Endosurgery has outperformed its industry in the past year. APEN has gained 50.4% versus the industry’s 4.8% fall.

Laboratory Corporation surpassed earnings estimates in each of the trailing four quarters, the average surprise being 25.7%. The company currently sports a Zacks Rank #1.

Laboratory Corporation’s long-term earnings growth rate is estimated at 10.6%. The company’s earnings yield of 9.4% compares favorably with the industry’s 3.4%.