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Cooper Companies (COO) Q3 Earnings In Line, '23 Outlook Raised
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The Cooper Companies, Inc. (COO - Free Report) reported third-quarter fiscal 2023 adjusted earnings per share (EPS) of $3.35, which was in line with the Zacks Consensus Estimate. The bottom line rose 5% on a year-over-year basis.
GAAP EPS in the quarter declined 14% from the year-ago period’s level to $1.71, primarily due to higher expenses.
Shares of this currently Zacks Rank #3 (Hold) company have risen 15.2% year to date compared with the industry’s 16.1% growth. The S&P 500 Index has gained 18.2% in the same time frame.
Image Source: Zacks Investment Research
Revenue Details
Revenues totaled $930.2 million, which outpaced the Zacks Consensus Estimate by 3.3%. The top line improved 10% on a year-over-year basis and 11% at constant currency (cc).
The figure rose 12% organically. Strong revenue growth across all segments and geographies driven by healthy demand for products and services was partially offset by an unfavorable currency movement. CooperVision’s (“CVI”) growth was driven by COO’s daily silicone hydrogel portfolio while CooperSurgical’s (“CSI”) growth was led by its fertility business.
Segmental Details
CooperVision: The segment’s revenues totaled $630.2 million, up 12% at cc and 11% on a reported basis. Organically, sales were up 13%.
Per management, the segment witnessed an increase in revenues from single-use sphere lenses (30% of CVI), indicating an improvement of 16% at cc and 14% on a reported basis. Single-use sphere lens’ revenues totaled $187.5 million.
Toric (34% of CVI) revenues amounted to $215.7 million, up 16% at cc as well as on a reported basis. Multifocal (13% of CVI) generated revenues of $80.8 million, up 19% at cc and 20% on a reported basis.
Non-single-use sphere lens’ (23% of CVI) revenues totaled $146.2 million, down 2% on a reported basis but up 3% organically from the year-ago quarter’s level.
Geographically, the segment witnessed a revenue improvement of $248.6 million in the Americas (39% of CVI), up 13% on a reported basis and at cc. EMEA revenues (38% of CVI) amounted to $242.2 million, up 10% year over year and 9% at cc.
Asia Pacific sales (23% of CVI) rose 9% year over year to $139.4 million. The figure was up 15% at cc and 11% reportedly.
CooperSurgical: The segment reported revenues of $300 million, up 9% at cc and 8% on a year-over-year basis.Organically, sales were also up 9%.
Sub-segment Office and Surgical products (59% of CSI) generated $178.4 million in revenues, up 8% at cc as well as on a year-over-year basis. Fertility (41% of CSI) revenues totaled $121.6 million, up 8% reportedly year over year and 9% at cc.
Margin Analysis
The gross profit was $610 million, up 10.5% year over year. The adjusted gross margin came in at 66% of net revenues, flat year over year.
Meanwhile, selling, general and administrative expenses increased 9.5% to $375.2 million. Research and development expenses rose 27.2% year over year to $36.5 million.
The operating income in the quarter totaled $151.6 million, up 7.8% year over year. The adjusted operating margin was 24%, up 100 basis points from the prior-year quarter’s figure.
Financial Position
COO exited the third quarter of fiscal 2023 with cash and cash equivalents of $117.3 million, up from $111.9 million at the end of the fiscal second quarter. Net cash provided by operating activities totaled $142.5 million.
Fiscal 2023 Guidance
Cooper Companies updated its financial guidance for fiscal 2023.
The company now projects total revenues in the range of $3.578-$3.595 billion, indicating organic growth of 9-10% from the previous guidance of $3.512-$3.569 billion (7-9% growth). The Zacks Consensus Estimate for the same is currently pegged at $3.48 billion.
CVI revenues are estimated in the $2.414-$2.425 billion range (organic growth of 10-11%) compared with the previous guidance of $2.365-$2.48 billion (organic growth of 8-10%). CSI revenues are projected in the band of $1.164-$1.17 billion, implying organic growth of 7-8% from the previously guided range of $1.147-$1.169 billion.
Adjusted EPS is anticipated in the band of $12.72-$12.90, tightened compared to the previous guidance of $12.66-$12.96. The Zacks Consensus Estimate for the same is pegged at $12.47.
For the fourth quarter, revenues and adjusted EPS are expected to be in the band of $912-$929 million and $3.39-$3.57, respectively. CVI and CSI revenues are estimated in the range of $613-$624 million and $299-$305 million, respectively.
Peer Performance
Some other stocks in the medical space that have announced quarterly results are Haemonetics (HAE - Free Report) , Align Technology (ALGN - Free Report) and McKesson (MCK - Free Report) .
The company reported second-quarter fiscal 2024 adjusted EPS of $1.05, which beat the Zacks Consensus Estimate by 38.2%. Revenues of $311 million outpaced the consensus mark by 4.5%.
Haemonetics has a long-term estimated growth rate of 10%. HAE’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 19.39%.
Align Technology carries a Zacks Rank #2 (Buy) at present. The company reported second-quarter fiscal 2023 adjusted EPS of $2.22, which beat the Zacks Consensus Estimate by 9.9%. Revenues of $1 billion outpaced the consensus mark by 1.7%.
Align Technology has a long-term estimated growth rate of 17.5%. ALGN delivered a trailing four-quarter average negative earnings surprise of 1.76%.
McKesson currently carries a Zacks Rank #2. The company recorded second-quarter 2023 adjusted earnings of $7.27 per share, which outpaced the Zacks Consensus Estimate by 24.3%. Revenues of $74.5 billion beat the Zacks Consensus Estimate by 6.6%.
McKesson has a long-term estimated growth rate of 10.7%. MCK’s earnings surpassed estimates in three of the trailing four quarters and missed once, delivering an average surprise of 8.1%.
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Cooper Companies (COO) Q3 Earnings In Line, '23 Outlook Raised
The Cooper Companies, Inc. (COO - Free Report) reported third-quarter fiscal 2023 adjusted earnings per share (EPS) of $3.35, which was in line with the Zacks Consensus Estimate. The bottom line rose 5% on a year-over-year basis.
GAAP EPS in the quarter declined 14% from the year-ago period’s level to $1.71, primarily due to higher expenses.
Shares of this currently Zacks Rank #3 (Hold) company have risen 15.2% year to date compared with the industry’s 16.1% growth. The S&P 500 Index has gained 18.2% in the same time frame.
Image Source: Zacks Investment Research
Revenue Details
Revenues totaled $930.2 million, which outpaced the Zacks Consensus Estimate by 3.3%. The top line improved 10% on a year-over-year basis and 11% at constant currency (cc).
The figure rose 12% organically. Strong revenue growth across all segments and geographies driven by healthy demand for products and services was partially offset by an unfavorable currency movement. CooperVision’s (“CVI”) growth was driven by COO’s daily silicone hydrogel portfolio while CooperSurgical’s (“CSI”) growth was led by its fertility business.
Segmental Details
CooperVision: The segment’s revenues totaled $630.2 million, up 12% at cc and 11% on a reported basis. Organically, sales were up 13%.
Per management, the segment witnessed an increase in revenues from single-use sphere lenses (30% of CVI), indicating an improvement of 16% at cc and 14% on a reported basis. Single-use sphere lens’ revenues totaled $187.5 million.
Toric (34% of CVI) revenues amounted to $215.7 million, up 16% at cc as well as on a reported basis. Multifocal (13% of CVI) generated revenues of $80.8 million, up 19% at cc and 20% on a reported basis.
Non-single-use sphere lens’ (23% of CVI) revenues totaled $146.2 million, down 2% on a reported basis but up 3% organically from the year-ago quarter’s level.
Geographically, the segment witnessed a revenue improvement of $248.6 million in the Americas (39% of CVI), up 13% on a reported basis and at cc. EMEA revenues (38% of CVI) amounted to $242.2 million, up 10% year over year and 9% at cc.
Asia Pacific sales (23% of CVI) rose 9% year over year to $139.4 million. The figure was up 15% at cc and 11% reportedly.
CooperSurgical: The segment reported revenues of $300 million, up 9% at cc and 8% on a year-over-year basis.Organically, sales were also up 9%.
Sub-segment Office and Surgical products (59% of CSI) generated $178.4 million in revenues, up 8% at cc as well as on a year-over-year basis. Fertility (41% of CSI) revenues totaled $121.6 million, up 8% reportedly year over year and 9% at cc.
Margin Analysis
The gross profit was $610 million, up 10.5% year over year. The adjusted gross margin came in at 66% of net revenues, flat year over year.
Meanwhile, selling, general and administrative expenses increased 9.5% to $375.2 million. Research and development expenses rose 27.2% year over year to $36.5 million.
The operating income in the quarter totaled $151.6 million, up 7.8% year over year. The adjusted operating margin was 24%, up 100 basis points from the prior-year quarter’s figure.
Financial Position
COO exited the third quarter of fiscal 2023 with cash and cash equivalents of $117.3 million, up from $111.9 million at the end of the fiscal second quarter. Net cash provided by operating activities totaled $142.5 million.
Fiscal 2023 Guidance
Cooper Companies updated its financial guidance for fiscal 2023.
The company now projects total revenues in the range of $3.578-$3.595 billion, indicating organic growth of 9-10% from the previous guidance of $3.512-$3.569 billion (7-9% growth). The Zacks Consensus Estimate for the same is currently pegged at $3.48 billion.
CVI revenues are estimated in the $2.414-$2.425 billion range (organic growth of 10-11%) compared with the previous guidance of $2.365-$2.48 billion (organic growth of 8-10%). CSI revenues are projected in the band of $1.164-$1.17 billion, implying organic growth of 7-8% from the previously guided range of $1.147-$1.169 billion.
Adjusted EPS is anticipated in the band of $12.72-$12.90, tightened compared to the previous guidance of $12.66-$12.96. The Zacks Consensus Estimate for the same is pegged at $12.47.
For the fourth quarter, revenues and adjusted EPS are expected to be in the band of $912-$929 million and $3.39-$3.57, respectively. CVI and CSI revenues are estimated in the range of $613-$624 million and $299-$305 million, respectively.
Peer Performance
Some other stocks in the medical space that have announced quarterly results are Haemonetics (HAE - Free Report) , Align Technology (ALGN - Free Report) and McKesson (MCK - Free Report) .
Haemonetics sports a Zacks Rank #1 (Strong Buy) at present. You can seethe complete list of today’s Zacks #1 Rank stocks here.
The company reported second-quarter fiscal 2024 adjusted EPS of $1.05, which beat the Zacks Consensus Estimate by 38.2%. Revenues of $311 million outpaced the consensus mark by 4.5%.
Haemonetics has a long-term estimated growth rate of 10%. HAE’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 19.39%.
Align Technology carries a Zacks Rank #2 (Buy) at present. The company reported second-quarter fiscal 2023 adjusted EPS of $2.22, which beat the Zacks Consensus Estimate by 9.9%. Revenues of $1 billion outpaced the consensus mark by 1.7%.
Align Technology has a long-term estimated growth rate of 17.5%. ALGN delivered a trailing four-quarter average negative earnings surprise of 1.76%.
McKesson currently carries a Zacks Rank #2. The company recorded second-quarter 2023 adjusted earnings of $7.27 per share, which outpaced the Zacks Consensus Estimate by 24.3%. Revenues of $74.5 billion beat the Zacks Consensus Estimate by 6.6%.
McKesson has a long-term estimated growth rate of 10.7%. MCK’s earnings surpassed estimates in three of the trailing four quarters and missed once, delivering an average surprise of 8.1%.