EssilorLuxottica (ESLOY – Free Report) recently announced the acquisition of Pulse Audition, a French startup that delivers artificial intelligence (AI)- based noise reduction and voice enhancement through algorithms that allow people with hearing impairments to understand speech better.
The latest acquisition is aimed at strengthening EssilorLuxottica’s presence in the hearing space.
Likely Trend of ESLOY Stock Following the News
Following the announcement, shares of the company plunged 0.6% to $119.90 last Thursday.
Recently, ESLOY has been focusing on expansion through value-added acquisitions. The latest acquisition of Pulse Audition aligns seamlessly with the company’s strategy in the hearing solutions space. This marked an evolution in the journey, which started in 2023 with the acquisition of Nuance Hearing.
Per management, revenue growth is expected to accelerate in the fiscal fourth quarter of 2025, including the consolidation impact from the recent acquisitions. Accordingly, we expect the latest acquisition to bolster investor confidence and create an upward momentum in ESLOY’s share price in the upcoming days.
The company currently has a market capitalization of $107.94 billion. The Zacks Consensus Estimate for 2024 revenues is pegged at $30.97 billion, indicating 12.7% growth from the reported figure of 2023.
Details on ESLOY’s Acquisition of Pulse Audition
Under the acquisition deal, EssilorLuxottica will integrate Pulse Audition’s proprietary technologies, expertise in AI software development, embedded AI, and audio signal processing, as well as its top talents. EssilorLuxottica will use Pulse Audition’s proprietary hardware and software to improve the quality of its products and solutions in the long term.
ESLOY’s Previous Strategic Acquisitions
Last month, EssilorLuxottica entered into an agreement to acquire Espansione Group — an Italian company specializing in the design and manufacturing of non-invasive medical devices for the diagnosis and treatment of dry-eye, ocular surface and retinal diseases. The acquisition will expand the portfolio of medical devices and solidify EssilorLuxottica’s role in the optical industry.
In October, EssilorLuxottica completed the acquisition of an 80% stake in Heidelberg Engineering — a German company specializing in diagnostic solutions, digital surgical technologies and healthcare IT for clinical ophthalmology. Heidelberg Engineering brings extensive technological and scientific expertise in optical coherence tomography, real-time image processing and analytics, large-scale data analysis and digital surgical navigation to serve medical professionals, scientists and researchers across a broad range of ophthalmic areas.
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The same month, EssilorLuxottica completed the acquisition of Supreme brand from VF Corporation (VFC). The aggregate base purchase price of the acquisition was $1.50 billion in cash, subject to customary adjustments. Supreme will have its own space within EssilorLuxottica’s house brand portfolio and complement its licensed portfolio as well.
Favorable Industry Prospects for ESLOY
Per a report from Fact.MR, the global AI hearing aid market value is projected to reach $7.51 billion in 2034, at a compound annual growth rate (CAGR) of 9.2% during 2024-2034.
Rapid improvements in AI, digital signal processing technologies and machine learning are making AI hearing aids efficient by enhancing sound quality, reducing noise and personalizing the hearing experience. Moreover, governments in several countries are taking initiatives to increase the adoption of AI hearing aids by reducing the cost of the product. These factors are likely to drive market growth.
ESLOY’s Share Price Performance
In the past year, ESLOY’s shares have gained 17% compared with the industry’s growth of 7.7%. The S&P 500 has gained 24.4% in the same time frame.
ESLOY’s Zacks Rank & Key Picks
ESLOY carries a Zacks Rank #3 (Hold) at present.
Some better-ranked stocks in the broader medical space are ResMed (RMD – Free Report) , Omnicell (OMCL – Free Report) and Abbott Laboratories (ABT – Free Report) .
ResMed, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 21.1% for 2025. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
RMD’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 6.41%. Its shares have risen 34.1% compared with the industry’s 7.7% growth in the past year.
Omnicell, carrying a Zacks Rank #2 at present, has an estimated earnings growth rate of 72.7% for fourth quarter 2024. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 121.74%.
OMCL’s shares have gained 26.4% against the industry’s 15.7% decline in the past year.
Abbott, carrying a Zacks Rank of 2 at present, has an estimated earnings growth rate of 10% for 2025. It delivered a trailing four-quarter average earnings surprise of 1.64%.
ABT’s shares have risen 8.5% in the past six months compared with the industry’s 7.2% growth.
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