CooperVision, a part of The Cooper Companies Inc. (COO - Analyst Report), a company focused on contact lens and women’s health, recently revealed that its Biofinity brand was the most rapidly growing brand of contact lenses in the U.S. market during the 12-month period ending Mar 2013. In fact, Biofinity added more users than any other frequently replaced lens brand over the preceding year. Cooper’s toric lenses led in the 30-day category.
COO’s Biofinity lenses use its Aquaform Technology. These lenses are made of a natural wettable substance that cuts down on deposits for day long comfort. Biofinity lenses retain moisture during usage and an additional wetting substance may therefore not be required. These lenses may be prescribed for 7 straight days and 6 nights.
The lens material uses a breakthrough substance that is porous to oxygen with a higher content of water. This yields a better experience for the lens user. The Aquaform knowhow from Cooper permits less silicone to be used in building the lens which permits greater permeability to oxygen. It also retains more water in the lens resulting in greater comfort and lower deposits.
The Biofinity set of products from Cooper includes Biofinity toric, Biofinity multifocal and Biofinity sphere. As per the company, 80% of contact lens users prefer the comfort of Biofinity toric lenses after about a month of usage.
The outlook for the contact lens industry is favorable. Trade up to value added lenses, such as silicone hydrogel or one-day lenses, constitutes a major avenue for growth. A trade up to 1-day disposable lenses sharply increases per user sales and profit. Cooper continues to grow sales at higher than market growth rates.
Cooper is a leader in the high-margin toric lens market. It offers multiple designs of toric lenses across a wide range of parameters, unlike some of its competitors, who offer toric lenses in a limited number of designs.
However, Cooper faces formidable competition in each of its major product lines. Competition comes from well established global contact lens makers. Depressed levels of consumer spending have heightened the company’s competitive pressures.
The stock currently carries a Zacks Rank #2 (Buy). We are also positive about Align Technology Inc. (ALGN - Analyst Report), CONMED Corporation (CNMD - Analyst Report) and Steris Corp. (STE - Snapshot Report) each of which carries a Zacks Rank #2 (Buy) and are expected to do well.