Organon & Co. (OGN)
NYSEHealth CareDrug Manufacturers - GeneralSnapshot 2026-09-09
$13.67-0.58%
Close 2026-09-09 · 1-day change
NYSEHealth CareDrug Manufacturers - GeneralSnapshot 2026-09-09
Broken: Primary pillar broken — Net income improves to at least $146 million in 2026-Q1: EPS 0.71 vs 0.85 consensus.
Organon is growing cash from operations, up $150 million in one year. Net income rose $59 million in the same period. The company completed a key acquisition to boost growth. The stock trades cheaply with a PE of 4, well below peers.
Revenue fell 4% year over year in the latest quarter. Earnings missed estimates by 16%. The company lowered gross margin guidance to 31%. Litigation and integration risks from the acquisition remain.
The price sits about 55% below our fair value near $30. Analysts expect about 1% revenue growth. Our view aligns that the market fairly prices modest growth but undervalues cash flow strength.
Breaks if: cash from operating activities falls below $225 million in 2026-Q1
Sustain positive cash flow from operations to support financial flexibility and deleveraging efforts.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a focus on strategic growth through a merger. The current thesis state is stable, supported by strong recent financial performance despite some mixed management priorities.
The market currently prices OGN as cheap compared to its peers, reflecting a low expectations gap. However, the valuation is justified given the company's recent weak execution quality.
Fundamentals are likely to show continued strong cash flow, but there are challenges with net income margins. The company's recent performance indicates a positive trajectory, although it has faced consecutive earnings misses.
The thesis hinges on the successful completion of the merger with Sun Pharmaceutical and the ability to maintain cash flow. Additionally, sector momentum from larger healthcare companies could significantly impact OGN's performance.
The most important moves since the prior daily snapshot.
Yes, our read has weakened. The latest earnings miss is a significant concern. This miss indicates that the company's financial performance is not meeting expectations.
as of 2026-09-09
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Stated as a priority in 3 of last 3 quarters. Cash from operating activities was $264M in 2025-Q3, $141M in 2025-Q4, and $225M in 2026-Q1, showing sustained positive cash flow. Management emphasizes maintaining operational performance and financial flexibility, indicating delivery on this priority with some quarter-to-quarter variability.
“Cash from operating activities was $225 million, supporting financial flexibility.”
“Cash from operating activities was $141 million, reflecting ongoing operational cash generation.”
“Cash from operating activities was $264 million, demonstrating strong cash flow.”
Breaks if: gross margin falls below 31% in FY2025
Breaks if: net income falls below $146 million in 2026-Q1
Breaks if: revenue falls below $6.2 billion in FY2026
Overall, OGN presents a complex picture with potential for growth but also significant risks. Not investment advice.