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Reasons to Add The Cooper Companies (COO) to Your Portfolio Now
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The Cooper Companies, Inc. (COO - Free Report) is well-poised for growth, backed by strong prospects in its CooperVision (CVI) and CooperSurgical (CSI) business segments. Acquisitions boost the company’s portfolio and buoy optimism. However, unfavorable currency movements and rising costs continue to hurt revenues and margins, respectively.
Shares of this Zacks Rank #2 (Buy) company have lost 0.5% year to date against the industry's 0.8% growth. The S&P 500 Index has gained 17.9% in the said time frame.
The Cooper Companies, with a market capitalization of $18.65 billion, is a global specialty medical device company.
The company’s bottom line is estimated to improve 11.3% over the next five years. Its earnings beat estimates in two of the trailing four quarters and met the mark in the other two, delivering an average surprise of 2.50%.
Image Source: Zacks Investment Research
What's Driving COO’s Performance?
The Cooper Companies has been leading the specialty lenses market, owing to innovative product portfolios, market-leading flexibility and strength in key accounts. Its flagship silicone hydrogel lenses, including MyDay and clarity, are expected to drive strong sales in the upcoming quarters. Moreover, its silicone hydrogel FRP lenses, Biofinity and Avaira, should boost top-line growth.
The lens business is likely to be driven by continued substantial growth across CVI’s Toric, Multifocal and single-use sphere subunits. The robust growth across all geographic regions is also encouraging. Moreover, the robust performance of COO’s myopia management portfolio, primarily driven by strong demand for MiSight, is also encouraging. The myopia management business is likely to improve in the upcoming quarters on the back of back-to-school promotional campaigns.
The CVI segment displayed solid performance in the second quarter, with revenues rising 10% at a constant exchange rate to $635.9 million. Per management, strong demand for silicone hydrogel lenses contributed to the segmental uptick.
In August, COO acquired obp Surgical, a U.S.-based medical device company known for its innovative single-use surgical products. obp Surgical’s distinctive ONETRAC portfolio complements CooperSurgical’s existing offerings, including INSORB, Lone Star and the Doppler Blood Flow Monitor.
CVI revenues are likely to be in the $2.591-$2.613 billion range (organic growth of 8.5-9.5%) in fiscal 2024.
The Cooper Companies is also well-positioned to benefit from the expanding CSI product portfolio. In the fiscal second quarter, CSI witnessed constant-currency revenue growth in two focus areas — fertility, and office and surgical products. Office and surgical product sales should continue to improve from the robust growth of PARAGARD, along with rising demand for stem cell storage. Although shipping interruptions at the company’s U.S. distribution center for medical devices and fertility products (following a systems upgrade in the fiscal second quarter) are likely to continue in the upcoming quarter, the impact is likely to improve.
Revenues from fertility increased 2% year over year to $123.8 million, indicating sustained solid performance. Sales of office and surgical products improved 12% to $182.9 million.
For fiscal 2024, CSI revenues are expected to be in the $1.272-$1.293 billion range, implying organic growth of 5-7%.
What's Weighing on the Stock?
The Cooper Companies generates a significant portion of its revenues in foreign currencies. Fluctuations in foreign exchange rates may significantly affect its overseas revenues.
Estimate Trend
The Zacks Consensus Estimate for the company's fiscal 2024 revenues is pegged at $3.88 billion, implying growth of 8% from the year-ago reported figure. The consensus mark for adjusted earnings per share is pinned at $3.57, indicating an improvement of 11.6% from the previous year’s recorded level.
In the past 60 days, COO’s earnings estimate for fiscal 2024 has improved 2% to $3.57 per share.
DaVita has an estimated long-term growth rate of 17.5%. DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 24.2%.
DaVita’s shares have risen 43.4% year to date compared with the industry’s 14.3% growth.
Aspen Technology has an estimated long-term growth rate of 13.1%. AZPN’s earnings surpassed estimates in two of the trailing four quarters and missed the same twice, the average surprise being 4.24%.
Shares of Aspen Technology have lost 4.2% year to date against the industry’s 13.5% growth.
Universal Health Services has an estimated long-term growth rate of 19%. UHS' earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.
The company’s shares have risen 48.6% year to date compared with the industry’s 39.7% growth.
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Reasons to Add The Cooper Companies (COO) to Your Portfolio Now
The Cooper Companies, Inc. (COO - Free Report) is well-poised for growth, backed by strong prospects in its CooperVision (CVI) and CooperSurgical (CSI) business segments. Acquisitions boost the company’s portfolio and buoy optimism. However, unfavorable currency movements and rising costs continue to hurt revenues and margins, respectively.
Shares of this Zacks Rank #2 (Buy) company have lost 0.5% year to date against the industry's 0.8% growth. The S&P 500 Index has gained 17.9% in the said time frame.
The Cooper Companies, with a market capitalization of $18.65 billion, is a global specialty medical device company.
The company’s bottom line is estimated to improve 11.3% over the next five years. Its earnings beat estimates in two of the trailing four quarters and met the mark in the other two, delivering an average surprise of 2.50%.
Image Source: Zacks Investment Research
What's Driving COO’s Performance?
The Cooper Companies has been leading the specialty lenses market, owing to innovative product portfolios, market-leading flexibility and strength in key accounts. Its flagship silicone hydrogel lenses, including MyDay and clarity, are expected to drive strong sales in the upcoming quarters. Moreover, its silicone hydrogel FRP lenses, Biofinity and Avaira, should boost top-line growth.
The lens business is likely to be driven by continued substantial growth across CVI’s Toric, Multifocal and single-use sphere subunits. The robust growth across all geographic regions is also encouraging. Moreover, the robust performance of COO’s myopia management portfolio, primarily driven by strong demand for MiSight, is also encouraging. The myopia management business is likely to improve in the upcoming quarters on the back of back-to-school promotional campaigns.
The CVI segment displayed solid performance in the second quarter, with revenues rising 10% at a constant exchange rate to $635.9 million. Per management, strong demand for silicone hydrogel lenses contributed to the segmental uptick.
In August, COO acquired obp Surgical, a U.S.-based medical device company known for its innovative single-use surgical products. obp Surgical’s distinctive ONETRAC portfolio complements CooperSurgical’s existing offerings, including INSORB, Lone Star and the Doppler Blood Flow Monitor.
CVI revenues are likely to be in the $2.591-$2.613 billion range (organic growth of 8.5-9.5%) in fiscal 2024.
The Cooper Companies is also well-positioned to benefit from the expanding CSI product portfolio. In the fiscal second quarter, CSI witnessed constant-currency revenue growth in two focus areas — fertility, and office and surgical products. Office and surgical product sales should continue to improve from the robust growth of PARAGARD, along with rising demand for stem cell storage. Although shipping interruptions at the company’s U.S. distribution center for medical devices and fertility products (following a systems upgrade in the fiscal second quarter) are likely to continue in the upcoming quarter, the impact is likely to improve.
Revenues from fertility increased 2% year over year to $123.8 million, indicating sustained solid performance. Sales of office and surgical products improved 12% to $182.9 million.
For fiscal 2024, CSI revenues are expected to be in the $1.272-$1.293 billion range, implying organic growth of 5-7%.
What's Weighing on the Stock?
The Cooper Companies generates a significant portion of its revenues in foreign currencies. Fluctuations in foreign exchange rates may significantly affect its overseas revenues.
Estimate Trend
The Zacks Consensus Estimate for the company's fiscal 2024 revenues is pegged at $3.88 billion, implying growth of 8% from the year-ago reported figure. The consensus mark for adjusted earnings per share is pinned at $3.57, indicating an improvement of 11.6% from the previous year’s recorded level.
In the past 60 days, COO’s earnings estimate for fiscal 2024 has improved 2% to $3.57 per share.
The Cooper Companies, Inc. Price
The Cooper Companies, Inc. price | The Cooper Companies, Inc. Quote
Key Picks
Some better-ranked stocks in the broader medical space that have announced quarterly results are DaVita (DVA - Free Report) , Aspen Technology (AZPN - Free Report) and Universal Health Services (UHS - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
DaVita has an estimated long-term growth rate of 17.5%. DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 24.2%.
DaVita’s shares have risen 43.4% year to date compared with the industry’s 14.3% growth.
Aspen Technology has an estimated long-term growth rate of 13.1%. AZPN’s earnings surpassed estimates in two of the trailing four quarters and missed the same twice, the average surprise being 4.24%.
Shares of Aspen Technology have lost 4.2% year to date against the industry’s 13.5% growth.
Universal Health Services has an estimated long-term growth rate of 19%. UHS' earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.
The company’s shares have risen 48.6% year to date compared with the industry’s 39.7% growth.