Last week, Bausch Health (BHC) unexpectedly gained 45%. A block trade between insiders at $9.00 led to the above-average volume.
John Paulson, a board member of the Canadian firm, bought over $300 million in Bausch + Lomb (BLCO). BLCO is a subsidiary of BHC. He bought nearly 35 million shares of BHC, paying an average of $9.00 ($312.5 million).
Carl Icahn, a billionaire investor, liquidated his entire position in BHC. He sold around 34.7 million BHC shares on Aug. 14.
Both BHC and BLCO shares are under the radar. B+L does not enjoy the same valuation as its peer, Alcon (ALC). BHC has enormous debt levels that would take many years to pay off. Revenue from Salix does not make enough cash flow to let BHC cut its debt at a faster rate.
In the beverage industry, Pepsi (PEP) is still a neglected stock. PEP stock could continue rising. 13F filings revealed that Nomura bought more than 4 million shares in the second quarter. Other new investors include Barclays.
Pepsi is a steady dividend payer. It has a strong brand whose snacks and drinks are resilient to a recession. Consumers might cut back on buying such items. But since Pepsi will advertise, they may keep buying Pepsi’s products.
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