STAAR Surgical (NASDAQ: STAA) closed at $27.17 on November 4, 2026, up about 9% after third-quarter results. Contrarian investor Z, who first recommended the stock near $17.50 after a rejected Alcon bid, says the print reinforces a turnaround and that $50 is reachable with patience. Skeptics still see a 12% year-over-year sales drop on the headline and gross margins stuck near 71%.
This is journalism and commentary, not investment advice. We hold no position unless stated.
Key facts
- Ticker: STAA on Nasdaq; situation type is a post-bid turnaround in implantable lenses.
- The call: Z posted on November 5 that "the turnaround continues" and that it is "not hard" for him to see $50; STAAR is now his second-largest position.
- Price: $27.17 at the November 4 close, the last close before his post; about $1.5 billion market value by his math and our check.
- Q3 sales: $83.4 million, down 12% year over year; up 21% excluding $25.9 million of deferred China sales recognized in Q3 2025, per the company release.
- Profit and cash: net income $5.6 million ($0.11 diluted); adjusted EBITDA $14.4 million; cash and investments $206.4 million with no debt.
- Buyback: board authorized a $50 million share repurchase program.
- China / EMEA: China sales $39.3 million (up 31% ex-deferred); EMEA up 31% year over year.
- Next test: whether gross margin recovers from 70.9% starting in the fourth quarter, as management said.
Is STAA a good bet after the earnings pop?
It depends on whether you believe underlying demand and the balance sheet matter more than the headline year-over-year sales drop. The stock has already risen about 30% over the past month and about 45% from recent lows on Z's telling, so the debate is about remaining upside, not a washed-out stub.
Why are investors bullish on STAAR Surgical?
- Underlying growth. Excluding the deferred China sales in the year-ago quarter, sales rose 21%, with China up 31% and EMEA up 31%.
- Cash and no debt. $206.4 million of cash and investments and a debt-free balance sheet fund buybacks and product work.
- Buyback. A new $50 million authorization signals the board thinks the shares are cheap relative to the franchise.
- Moat claim. Z cites Collamer technology, regulatory history and surgeon relationships as reasons competitors struggle to catch up in implantable lenses.
- Prior bid context. Alcon's proposed $30.75 takeout was blocked by Broadwood Partners; Z argues the business is "many times better" now than when that offer was rejected.
Who's making this call and why?
Z posts contrarian special-situation ideas. On November 5 he wrote: "It's not hard for me to see $STAA reaching $50 per share with patience." He says he first recommended the stock near $17.50 and that it is now his second-largest holding after the rally.
Track record. In our tracking he is 12-11 on 23 calls scored at 180 days against the S&P 500, with an average edge of +3.6 points. His long book went 6-9 in that sample. See the scoreboard.
Other voices. Stifel maintained a Buy and raised its price target to $34 from $31 after the print, according to market summaries circulating on X; that is a Street target, not a tracked north-star call. Point72 Asset Management filed a Schedule 13G in May 2026 showing a stake of about 5.2%. Z says Point72 bought near $29; we did not independently verify a fresh purchase immediately before the November print.
Who disagrees?
Headline readers stress the reported year-over-year declines. One earnings summary account noted that operating income "plummeted" as revenue fell 12% to $83.4 million. Gross margin was 70.9%, versus 82.2% a year earlier (and about 75.5% excluding the deferred China sales effect, per the call). Management expects China seasonality to moderate near-term revenue and earnings even if free cash flow holds.
Other risks:
- Factory limits. Commentary around the print said Chinese demand for some lenses outran supply, capping volume.
- Already re-rated. After a roughly 45% bounce from the lows Z cites, more of the turnaround may already be in the price.
- Prior coverage. We featured a STAAR piece in mid-October after the Alcon fight; this is a new post-earnings check, not a new name.
What are the key facts to verify?
- The BusinessWire release for Q3 sales, the China deferral bridge, cash and the $50 million buyback.
- Gross margin in Q4 and into 2027 versus the 70.9% print.
- Point72's latest 13F or amendments versus the May 2026 Schedule 13G.
- Any update on U.S. sales staying above $6 million a quarter.
What would prove it right or wrong?
Signals the turnaround thesis is working:
- Underlying sales growth holding in the high teens or better with China volume catching supply.
- Gross margin moving back toward the mid-70s as temporary costs fade.
- Buybacks executed without starving product investment.
Signals it is fading:
- China growth stalling once supply catches up, or another gross-margin miss.
- Cash falling as working capital or tariffs bite.
- A failed repurchase or a capital raise that undercuts the debt-free story.
This is journalism and commentary, not investment advice. We hold no position unless stated.
