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The Cooper Companies (COO) Down 10.2% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for The Cooper Companies (COO - Free Report) . Shares have lost about 10.2% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is The Cooper Companies due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Cooper Companies Q3 Earnings & Revenues Top Estimates

The Cooper Companies reported third-quarter fiscal 2022 adjusted earnings per share (EPS) of $3.24, which beat the Zacks Consensus Estimate of $3.20 by 4.9%. The bottom line declined 6% on a year-over-year basis.

GAAP EPS in the fiscal third quarter was $1.98, down 84% from the year-ago quarter. The company had recorded a tax benefit of $534.9 million in the year-ago quarter that was absent this year, resulting in a significant decline in GAAP EPS.

Revenue Details

Revenues of this Zacks Rank #3 (Hold) company were $843.4 million in the quarter under review, surpassing the Zacks Consensus Estimate by 1.4%. On a year-over-year basis, the top line improved 10.5% and surged 18% at constant currency (cc). Revenues were up 9% organically. Strong revenue growth across all segments and geographies was partially offset by unfavorable currency movement, which hurt sales growth of the CooperVision (CVI) segment in the EMEA and the Asia Pacific regions.

Fiscal Q3 Segment Details


The segment’s revenues totaled $566.3 million, up 10% at cc and 2% on a reported basis. Organically sales were up 11%.

Per management, the segment witnessed an increase in revenues from Single-use sphere lenses (29% of CVI), reflecting an improvement of 13% at cc and 3% on a reported basis. Single-use sphere lens revenues totaled $163.8 million.

Toric (33% of CVI) revenues amounted to $185.9 million, up 11% at cc and 3% on a reported basis.

Multifocal (12% of CVI) generated revenues of $67.6 million, up 19% at cc and 10% on a reported basis.

Non-single-use sphere (26% of CVI) revenues were $149 million, up 3% at cc but down 4% reportedly from the year-ago quarter.

Geographically, the segment witnessed an improvement in revenues in the Americas (39% of CVI), up 7% on a reported basis as well as at cc to $220.1 million.

EMEA revenues (39% of CVI) amounted to $220.2 million, up 12% year over year but down 1% at cc.

Asia Pacific sales (22% of CVI) improved 12% year over year to $126 million. However, sales were down 2% at cc.

CooperSurgical (CSI)

The segment reported revenues of $277.1 million, up 39% at cc and 35% on a year-over-year basis. Organically sales were up 3%.

Sub-segment Office and Surgical products (60% of CSI) generated $165.4 million in revenues, up 36% at cc and 35% on a year-over-year basis.

Fertility (40% of CSI) revenues were $114.4 million, up 34% year over year and 44% at cc.

Margin Analysis

In the fiscal third quarter, gross profit was $552.1 million, up 7% year over year. Adjusted gross margin was 66% of net revenues, down 300 basis points (bps) year over year, primarily due to unfavorable currency movements.

Meanwhile, selling, general and administrative expenses declined 2.8% to $342.7 million. Research and development expenses increased 15.7% year over year to $28.7 million.

Operating income in the quarter totaled $140.6 million, which gained 39.8% year over year. Adjusted operating margin was 23%, down 400 bps from the prior-year quarter.

Financial Position

The company exited the third quarter of fiscal 2022 with cash and cash equivalents of $246.3 million, down from $399.2 million at the end of fiscal second-quarter 2022.

Net cash provided by operating activities during the fiscal third quarter was $263.9 million.

Fiscal 2022 Guidance

Cooper Companies has updated its financial guidance for the fiscal year 2022. It is to be noted that the outlook does not include the Cook Medical Reproductive Health buyout that was announced on Feb 7, 2022, as regulatory approval is pending.

For fiscal 2022, the company projects total revenues between $3.29 billion and $3.31 billion, reflecting 10% to 11% organic growth compared with the previous guidance between $3.28 billion and $3.31 billion, reflecting 9% to 10% organic growth. The Zacks Consensus Estimate for the same is currently pegged at $3.29 billion.

CVI revenues are estimated to be $2.24-$2.25 billion (organic growth of 11-12%). CSI revenues are expected to be within $1.055-$1.064 billion, implying organic growth of 7-8%.

Adjusted EPS is anticipated to be $12.72-$12.87, down from the previously guided range of $13.09-$13.29. The Zacks Consensus Estimate for the same currently stands at $13.13.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in estimates revision.

The consensus estimate has shifted -9.53% due to these changes.

VGM Scores

At this time, The Cooper Companies has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise The Cooper Companies has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.

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