Eye care stocks look great as we move into 2023.
Are you ready to see where your money can go? We’ve captured six of the best eye care stocks to add to your portfolio right now.
6 Best Eye Care Stocks To Watch
Alcon AG (NYSE: ALC)
Alcon is a global leader in eye care and has been dedicated to helping people see better for over 75 years.
It is the largest eye device company in the world, serving patients in more than 140 countries.
Everything started as a small pharmacy in Fort Worth, Texas, before growing into the eye care giant it is today. Its headquarters sit in Switzerland after being bought out by Nestle in 1977.
The company’s business model splits down the middle between surgical needs and vision care.
Each segment is known for industry firsts and a healthy research budget to meet new needs.
Through state-of-the-art equipment, Alcon assists in both common and the most complex surgical eye procedures known to humankind.
It also boasts a wide range of products, from contact lenses to eye drops for consumer use.
Alcon is also deeply rooted in educating its customers on best-use practices for optimal outcomes.
On the financial side of the spectrum, Alcon maintains at least $2 billion in revenue each quarter. These numbers align with what analysts expect to see.
The company’s 12-month price target looks favorable, with an up to 20% upside. Its share price appears undervalued, with some good momentum behind it.
Currently, ALC pays out an annual 0.32% dividend yield to shareholders.
Ocular Therapeutix Inc (NASDAQ: OCUL)
Ocular Therapeutix works in the formation, development, and commercialization of products to address diseases and conditions of the eye. The company was founded in 2006 out of Bedford, Massachusetts.
Its first approved product, DEXTENZA®, is a corticosteroid for treating ocular inflammation and pain following ophthalmic surgery. It can also subdue itching associated with allergic conjunctivitis.
ReSure® Sealant is a new, FDA-approved device to help with wound leaks in corneal incisions following cataract surgery. Although not on the market yet, Ocular Therapeutix plans to have it there soon.
Ocular Therapeutix has at least seven products currently in the pipeline. Five of these are in clinical trials, with milestones approaching in 2023 and 2024.
These medications each target a specific area of need, from wet macular degeneration to glaucoma and dry eye.
OCUL stock has enjoyed a substantial price increase since the beginning of the year.
Investors like the 101% gain and believe the stock isn’t at the top yet. Predictions place OCUL as high as $15 by the beginning of next year.
The proof is in one successful drug and another on the way to the market.
Many pharmaceutical companies never reach this stage, and now Ocular Therapeutix has cash on hand to fund its pipeline.
Time will tell if OCUL climbs to the expected heights, but things are looking up for this pick.
National Vision Holdings Inc (NASDAQ: EYE)
National Vision Holdings is the second-largest optical retail company in the United States. It’s also one of the fastest growing, with over 1,300 stores in 44 states and Puerto Rico.
The company opened its first doors in 1990 to operate a handful of vision centers for Walmart. Continued growth puts National Vision Holdings on track to open 75 new stores this year alone.
As a whole, National Vision Holdings encompasses five distinct brands to fulfill its vision of helping people see.
Still operating out of Walmart’s vision center, it also runs AC Lens, America’s Best, Eyeglass World, and Vista Optical.
Between all these locations, National Vision employs more than 2,200 optometrists. Glasses dominate the company’s overall sales, but its contact lens market is also growing.
EYE stock is currently down, possibly due to the company’s less-than-stellar financials over the last year. This is not a stock to write off, however.
Several signs point to EYE being an excellent value candidate. At last glance, its price to sales was 0.91, and it sported a price to book hovering at 2.00.
Investors could see significant gains if National Vision Holdings returns to its suspected price target.
As a long-term play, this could be a buy-and-wait kind of experience.
EyePoint Pharmaceuticals Inc (NASDAQ: EYPT)
EyePoint Pharmaceuticals focuses on developing and manufacturing therapeutics to improve patients’ lives with severe eye disorders.
The company operates primarily out of its Watertown, Massachusetts, headquarters.
Not new to the eye care scene, EyePoint Pharmaceuticals already has two products on the shelves.
YUTIQ® is an intravitreal injection indicated for the treatment of chronic non-infectious uveitis. A single injection can prevent flare-ups for up to three years.
DEXYCU® targets inflammation that follows invasive eye surgery. Like YUTIQ®, the suspension is designed for continued relief after a single use.
EyePoint also implements proven technology for administering each of these drugs. These same technologies are backward compatible to administer older medications.
Moving forward, EyePoint Pharmaceuticals has its newest drug in phase 2 testing for treating macular degeneration and diabetic retinopathy.
The stock market hasn’t been kind to EYPT stock, sinking from the $14 to the penny stock range over the course of the last year.
Fortunately, the company appears to have the foundation to dig itself back out.
By our best estimates, now could be the time EYPT stock begins its long road to recovery.
Analysts project gains as high as 1,000% for the next year due to growth potential and shifting momentum.
Kala Pharmaceuticals Inc (NASDAQ: KALA)
Like EyePoint, Kala Pharmaceuticals also calls Watertown, Massachusetts home.
This clinical-stage company is also vested in the research, development, and production of therapies for rare eye diseases.
Although in the clinical stage, Kala is not new to the development of commercial products.
It previously launched two drugs, EYSUVIS®, and INVELTYS®, for managing dry eye symptoms and handling postoperative inflammation.
In July of last year, Kala sold both of these products to Alcon. Using the income from these sales, it now devotes its full attention to its development pipeline.
Part of Kala’s logic behind selling its flagship products was the acquisition of Combangio, Inc.
It believes the mesenchymal stem cell secretome technology Kala gained from this purchase will aid in developing its next asset.
Currently nearing the end of phase one testing, Kala’s new drug is designed to treat rare ocular surface diseases. Another medication for rare inherited retinal disease is currently in preclinical trials.
Investors have questioned some of Kala’s decisions along the way. These concerns have resulted in a loss of interest in the stock over the last few years.
We can’t help but wonder if Kala is up to something with its latest product strategy.
The momentum happening right now behind the scenes may be leading to breakthroughs that will send share prices back up.
Cooper Companies, Inc. (NYSE: COO)
Cooper Companies is a global medical device producer supporting people at every stage of life. Founded in 1958, the company has a long history in pharmacy, surgery, and vision.
Today, Cooper Companies focus on two core areas, CooperVision and CooperSurgical. Between the two, Cooper has nearly 12,000 employees and a presence in over 130 countries.
Its vision business manufactures billions of contact lenses every year to feed the growing need. These lenses represent the widest range of prescription options available in the world today.
CooperVision acquired EnsEyers in 2022 to add scleral and orthokeratology lenses to its portfolio.
CooperSurgical addresses the needs of women, babies, and families.
It provides an extensive range of reproductive care, fertility and birth, and women’s care products for various uses.
Its efforts across these divisions translate to healthy financial growth. Revenues remain consistently up about 10% from the year prior.
COO stock has seen a fairly steady climb over the last dozen years, dipping only at the cusp of 2022. Its momentum returned near the end of the year and hasn’t slowed since.
Now’s looking to be an ideal time to jump on board with Cooper Companies if you haven’t already.
Price estimates still predict a profitable upside for the coming months.
Are Eye Care Stocks a Good Investment?
Eye care stocks can be a great investment if you play your cards right. We value our eyes more than any other sense for decision-making. As a result, people tend to spend more money in this space.
Healthcare is a sector that will never go away, thanks to a never-ending need for treatment. It’s more or less recession-proof, even if people do cut back slightly on doctor visits when funds are tight.
The eye care industry is also growing, and companies are rising to the challenge of unmet needs.
Demand for eye care is increasing around the globe, leading to more product production each year.
Interestingly, there seems to be a nice mix of growth and value stocks to choose from.
Companies like Alcon and Cooper ride on momentum, whereas biopharmaceutical firms such as EyePoint and Kala are working their way back to a proper valuation.
When it comes to the best eye care stocks, there’s something for everyone. We’re excited about the potential of the stocks above, but be sure to do your own research before jumping in.
Frequently Asked Questions (FAQs)
What’s The Best Healthcare Stock to Buy?
Any of the eye care stocks on our list have good potential for growth. Outside of eyes, companies like UnitedHealth Group Inc (NYSE: UNH) and Pfizer Inc. (NYSE: PFE) are looking solid.
Do Healthcare Stocks Do Well in a Recession?
Healthcare is in demand, no matter the state of the economy. As a result, healthcare stocks tend to shine even when markets are down.
Will Healthcare Stocks Do Well in 2023?
Healthcare stocks, in general, tend to do well year after year as patients rely on products. They’re off to a slow start this year but are expected to pick up as the months press on.
How to Invest in Healthcare Stocks?
Many healthcare stocks are accessible for purchase on major exchanges. You can also invest in mutual funds or ETFs along the same means.
Are Healthcare Stocks Risky?
No stock is without risk, and healthcare is no exception. Regulatory approvals and reduced demand for niche products can send companies into a tailspin.
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