Core Insights - The Cooper Companies, Inc. (COO) is experiencing growth driven by CooperVision's premium lens migration and MiSight's leadership in myopia management, alongside CooperSurgical's women's health and fertility portfolio [1] - Near-term performance is impacted by channel volatility, private-label transition risks, softness in the Asia-Pacific region, and tariff/foreign exchange pressures, although long-term opportunities remain robust [1] Financial Performance - COO's shares have increased by 15.5% over the past six months, outperforming the industry growth of 12.9% and the S&P 500 Index's increase of 14.5% [2] - The company has a market capitalization of $16.19 billion and is expected to see a 7.8% improvement in its bottom line over the next five years, with earnings beating estimates in three of the last four quarters [4] Growth Drivers - CooperVision's MyDay daily silicone hydrogel franchise is a key growth engine, with strong global rollout and uptake in various lens types, supported by expanding private-label contracts [5] - Capacity constraints in Asia-Pacific have been resolved, allowing for improved execution and higher revenues per patient, despite lower gross margins from daily silicone hydrogel lenses [6] - MiSight, the only FDA-approved contact lens for myopia control, reported 37% growth in Q4 and nearly $104 million in sales for fiscal 2025, with management guiding for 20-25% growth in fiscal 2026 [7] Operational Improvements - A recent reorganization is expected to yield nearly $50 million in annual pretax savings starting in fiscal 2026, enhancing cash flow and operational efficiency [10] - Operating margins expanded to 27% in Q4, with further improvements anticipated, while free cash flow reached $150 million, raising the cumulative target for fiscal 2026-2028 to over $2.2 billion [11] Capital Allocation - The company emphasizes shareholder returns, having repurchased nearly $300 million of stock in fiscal 2025, with plans for similar allocations in fiscal 2026 supported by a $2 billion authorization [12] - Free cash flow is projected to rise to $575-$625 million in fiscal 2026 as capital expenditures normalize, improving net leverage to 1.76x [12] Challenges - Gross margin pressures persist due to the mix shift towards lower-margin daily silicone hydrogel lenses and ongoing tariff impacts, with management guiding for further declines in fiscal 2026 [13][14] - The Asia-Pacific region, particularly China, saw a 28% decline in Q4 due to weaknesses in low-margin e-commerce channels, with management prioritizing profitability over volume [15] - Fertility demand in the CooperSurgical segment remains sensitive to consumer spending, leading to conservative guidance for the next fiscal year despite early signs of improvement [16] Revenue Estimates - The Zacks Consensus Estimate for fiscal 2026 revenues is $4.31 billion, reflecting a 5.3% growth from the previous year, with adjusted EPS expected to improve by 9.5% to $4.51 [17]

Core Viewpoint - CooperCompanies has appointed Walter (Walt) M Rosebrough, Jr. as an independent director and entered into a cooperation agreement with Browning West, aiming to enhance governance and drive long-term value for shareholders [1][3]. Group 1: Appointment and Governance - Walter Rosebrough will join the Board's Corporate Governance & Nominating Committee and is being considered for the Chair position by the end of 2026 [1]. - The Board will also appoint a new independent director with medical technology experience, in agreement with Browning West [1]. Group 2: Background of Walter Rosebrough - Rosebrough served as CEO of STERIS from 2007 to 2021, achieving a 10-fold total return on stock and an 18% annualized return, compared to a 10% annualized return for the S&P 500 [2]. - His career includes nearly two decades at Hill-Rom Holdings, where he held senior executive roles [2]. Group 3: Strategic Vision and Cooperation - Colleen Jay, the Incoming Chair of the Board, emphasized Rosebrough's leadership experience and track record in supporting sustainable growth [3]. - Browning West expressed confidence in Cooper's long-term potential and the constructive path forward with the Board [3]. - Browning West has agreed to customary standstill and voting commitments and will support the Board's full slate of directors at the 2026 Annual Meeting [3]. Group 4: Company Overview - CooperCompanies is a global medical device company with two business units: CooperVision and CooperSurgical, impacting over fifty million lives annually [4]. - The company is headquartered in San Ramon, CA, employs over 15,000 people, and sells products in over 130 countries [4]. Group 5: About Browning West - Browning West is an independent investment partnership focused on long-term value creation in high-quality businesses, primarily in North America and Western Europe [5]. - Founded in 2019, it is backed by leading foundations, family offices, and university endowments [5].

Core Insights - The Cooper Companies, Inc. (COO) is showing potential for a bullish breakout as it has reached a key level of support and experienced a "golden cross" in its moving averages [1] - The stock has gained 16% over the past four weeks, indicating positive momentum [3] - The Zacks Rank for COO is currently 2 (Buy), suggesting further potential for price increases [3] Technical Analysis - A "golden cross" occurs when a stock's 50-day simple moving average crosses above its 200-day simple moving average, signaling a potential bullish trend [1] - The formation of a golden cross involves three stages: a downtrend that bottoms out, a crossover of the shorter moving average over the longer one, and continued upward momentum [2] Earnings Expectations - There have been four upward revisions in earnings expectations for COO in the current quarter, with no downward revisions, indicating strong investor confidence [3] - The Zacks Consensus Estimate for COO has also increased, further supporting the bullish outlook [3] Investment Outlook - The combination of positive earnings estimate revisions and the technical "golden cross" suggests that investors should monitor COO for potential gains in the near future [5]

Core Insights - Zacks Premium offers tools for investors to enhance their stock market strategies and confidence [1] - The Zacks Style Scores are designed to complement the Zacks Rank, helping investors identify stocks likely to outperform the market [2] Zacks Style Scores Overview - Stocks are rated A, B, C, D, or F based on value, growth, and momentum characteristics, with higher scores indicating better performance potential [3] - The Value Score focuses on identifying undervalued stocks using financial ratios like P/E and Price/Sales [4] - The Growth Score assesses a company's financial health and future growth potential through earnings and sales projections [5] - The Momentum Score identifies stocks with favorable price trends, utilizing recent price changes and earnings estimate shifts [6] - The VGM Score combines all three Style Scores, providing a comprehensive indicator for stock selection [6] Zacks Rank and Style Scores Interaction - The Zacks Rank uses earnings estimate revisions to identify top-performing stocks, with 1 (Strong Buy) stocks achieving an average annual return of +23.81% since 1988 [7] - There are over 800 stocks rated 1 or 2, making it essential to use Style Scores for effective selection [8] - Stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B are recommended for maximizing return potential [9] Company Spotlight: The Cooper Companies - The Cooper Companies operates in the medical device sector with two segments: CooperVision (CVI) and CooperSurgical (CSI) [11] - CVI specializes in contact lenses, particularly in daily silicone hydrogel lenses and myopia management, while CSI focuses on fertility and women's health products [11] - COO holds a 2 (Buy) rating on the Zacks Rank, with a VGM Score of B and a Momentum Style Score of A, reflecting a 14.4% increase in share price over the past four weeks [12] - Recent upward revisions in earnings estimates indicate a positive outlook, with the Zacks Consensus Estimate rising to $4.47 per share [12] - COO's strong performance metrics make it a notable investment opportunity [13]

Company Overview - The Cooper Companies, Inc. (COO) has a market capitalization of $15.8 billion and specializes in medical devices, particularly contact lenses and women's health care solutions through its CooperVision and CooperSurgical segments [1] - The company is classified as a "large-cap" stock, serving healthcare professionals and distributors globally [2] Stock Performance - COO shares have declined 19.6% from their 52-week high of $100.47, but have increased 19.3% over the past three months, outperforming the Nasdaq Composite's 8.1% increase during the same period [3] - Year-to-date, COO stock is down 12.2%, lagging behind the Nasdaq's 22.5% surge, and has decreased 18.5% over the past 52 weeks compared to the Nasdaq's 20.2% return [4] Financial Results - Following the Q4 2025 results released on December 4, COO shares rose 5.7%, with adjusted EPS of $1.15 and revenue of $1.07 billion, both exceeding consensus expectations [5] - The company provided a positive outlook for fiscal 2026, projecting adjusted EPS guidance of $4.45 - $4.60 and free cash flow of $575 million - $625 million, with a long-term goal of generating over $2.2 billion in free cash flow from 2026 to 2028 [5] Analyst Sentiment - Despite underperformance compared to rival Intuitive Surgical, which has seen a YTD increase of 6.5%, analysts maintain a moderately optimistic view on Cooper, with a consensus rating of "Moderate Buy" from 17 analysts [6] - The mean price target for COO stock is $89.62, indicating a potential upside of nearly 11% from current levels [6]

Core Insights - The Cooper Companies (COO) is currently more attractive to value investors compared to Merit Medical (MMSI) based on earnings outlook and valuation metrics [3][7] Valuation Metrics - COO has a forward P/E ratio of 17.56, while MMSI has a forward P/E of 22.36 [5] - COO's PEG ratio is 2.26, compared to MMSI's PEG ratio of 2.32, indicating a more favorable earnings growth outlook for COO [5] - COO has a P/B ratio of 1.89, whereas MMSI's P/B ratio is 3.23, suggesting that COO is undervalued relative to its book value [6] Investment Grades - COO has a Zacks Rank of 2 (Buy) and a Value grade of B, while MMSI has a Zacks Rank of 3 (Hold) and a Value grade of C, indicating stronger overall performance for COO [3][6]

Company Overview - The Cooper Companies is a global medical device company with two main segments: CooperVision (CVI) and CooperSurgical (CSI) [11] - CVI focuses on contact lenses, particularly in daily silicone hydrogel lenses, torics, multifocals, and myopia management, with flagship products like MyDay and MiSight [11] - CSI provides products and services in fertility and women's health, including in-vitro fertilization (IVF) solutions and contraceptives [11] Investment Ratings - COO is currently rated 3 (Hold) on the Zacks Rank, with a VGM Score of B [12] - The Value Style Score is also B, supported by a forward P/E ratio of 18.54, indicating attractive valuation metrics for value investors [12] - The Zacks Consensus Estimate for fiscal 2026 has increased to $4.39 per share, with one analyst revising their earnings estimate upwards in the last 60 days [12] Performance Metrics - COO has an average earnings surprise of +2.4%, suggesting a positive trend in earnings performance [12] - With a solid Zacks Rank and strong Value and VGM Style Scores, COO is recommended for investors' consideration [13]

Core Insights - The Cooper Companies' international operations are crucial for understanding its financial resilience and growth potential, with a total revenue of $1.07 billion for the last quarter, reflecting a 4.6% increase year-over-year [4] International Revenue Analysis - EMEA generated $277.1 million, accounting for 26% of total revenue, surpassing Wall Street's estimate of $269.49 million by 2.82%. This is a decrease from $292.1 million (27.6%) in the previous quarter and an increase from $256.6 million (25.2%) in the same quarter last year [5] - Asia Pacific contributed $147.4 million, representing 13.8% of total revenue, exceeding the consensus estimate of $139.8 million by 5.44%. This is a slight decrease from $140.3 million (13.2%) in the previous quarter and a decrease from $149.3 million (14.7%) in the same quarter last year [6] Revenue Forecasts - Analysts project The Cooper Companies will achieve revenues of $1.03 billion for the ongoing fiscal quarter, a 6.4% increase year-over-year, with expected contributions from EMEA at 25.6% ($263.05 million) and Asia Pacific at 13.6% ($139.27 million) [7] - For the entire year, total revenue is forecasted at $4.3 billion, a 5.1% improvement from the previous year, with EMEA contributing 26% ($1.12 billion) and Asia Pacific 13.5% ($582.53 million) [8] Market Dependency and Performance - The Cooper Companies' reliance on global markets for revenue presents both opportunities and challenges, making the monitoring of international revenue trends essential for predicting future performance [9] - In the context of increasing international interdependencies and geopolitical tensions, analysts are closely tracking these trends to refine earnings predictions, while also considering domestic factors that influence earnings forecasts [10] Stock Performance - The Cooper Companies' stock has increased by 16.1% over the past month, outperforming the S&P 500's 1.2% increase, and has risen by 22.1% over the past three months compared to the S&P 500's 6.3% increase [13]

Company Segments - Cooper Companies operates through two segments: CooperVision, focusing on contact lenses, and CooperSurgical, specializing in fertility and women's health[21]. - CooperSurgical offers over 600 products and services, including medical devices for gynecology and obstetrics, and fertility products used in IVF processes[23][31]. Product Innovations - CooperVision's MiSight 1 day lens is the first FDA-approved product to slow myopia progression in children aged 8-12, with approvals in China and Japan expected in 2021 and 2025 respectively[22][30]. - CooperSurgical's Paragard IUD is a hormone-free contraceptive option available in the U.S., competing with hormonal IUDs and other birth control methods[36]. - CooperVision's Biofinity brand is its highest-grossing product, with a focus on silicone hydrogel lenses for various vision correction needs[26]. Research and Development - The company employs approximately 500 people in research and development, focusing on new contact lens designs and manufacturing technologies[44]. - CooperSurgical's research and development includes innovations in instruments, devices, and digital services to improve clinical outcomes[45]. - The company is committed to expanding its integrated solutions model in fertility and women's health through strategic transactions and product development[34]. Market Trends - The market for contact lenses is expanding, particularly in myopia management, with CooperVision investing in education to increase awareness among practitioners and families[29][30]. - CooperSurgical anticipates a shift towards group practices and corporate ownership in OB/GYN and fertility clinics, which may enhance supply chain control and vendor standardization[39]. - The contact lens industry is evolving with new distribution models and online services, which may conflict with CooperVision's strategy[145]. Regulatory Compliance - The majority of medical devices marketed by the company have received FDA clearance through the 510(k) process or approval through the PMA process[51]. - The company maintains ISO 13485 certification and CE marks for its products, which are necessary for marketing medical devices in the EU[61]. - Compliance with general safety and performance requirements is essential for obtaining CE marks, which are necessary for marketing in the EU[65]. - The company must undergo conformity assessments and audits by EU notified bodies to ensure compliance with the EU IVDR for current and future tests[69]. - The FDA's Cybersecurity requirements for medical devices include a comprehensive risk management plan and a Software Bill of Materials (SBOM) to support vulnerability tracking[58]. International Operations - The company derives approximately 50% of its net sales from international markets, indicating a strong reliance on foreign operations for growth[109]. - In Asia Pacific, regulatory approval processes for medical devices are complex and vary significantly by country, often requiring proof of home country approval prior to registration, which can delay product launches[73]. - The NMPA in China mandates physical testing and in-country clinical trials for medical device registrations, impacting the time to market[74]. Financial Risks - The company faces significant risks from current market conditions, including recessionary pressures that could adversely affect liquidity and financial condition[105]. - Inflationary pressures have led to increased costs, which may not be fully passed on to customers, impacting profitability[108]. - Pricing pressure from competitors and changes in third-party reimbursement could adversely affect demand for CooperSurgical products, impacting operating results[126]. Cybersecurity and IT Risks - Cybersecurity threats are increasing, with potential disruptions to information technology systems that could lead to significant financial and reputational harm[121]. - The company is in the process of implementing new ERP systems, which are costly and complex, potentially impacting financial reporting and commercial activities[123]. Employee and Workplace Culture - The company has implemented a Connection & Belonging strategy to foster an inclusive work environment, promoting diversity and innovation[98]. - The company emphasizes employee training and development, offering job-specific training and regular feedback to enhance workplace culture[100]. - The company is experiencing challenges in recruiting and retaining skilled personnel, which could disrupt operations[159]. Competition and Market Position - CooperVision operates in a highly competitive environment, facing significant competition from major players like Johnson & Johnson and Alcon, which may have greater resources[143]. - CooperSurgical competes in the family and women's health care market, focusing on technological and scientific advances, product quality, and customer service[146]. Regulatory Challenges - The evolving regulatory landscape in the EU and UK may significantly impact business operations and compliance costs[186]. - Changes in healthcare legislation, such as the ACA and recent EU regulations, could materially impact the company's revenue and operational costs[210][213]. - Compliance with evolving environmental, social, and governance (ESG) regulations may incur significant costs and affect the company's operations[156].

Core Viewpoint - Cooper Companies reported better-than-expected fourth-quarter earnings and provided optimistic financial guidance, leading to a rise in stock price [1][7] Financial Performance - The company reported fourth-quarter adjusted earnings of $1.15 per share, an 11% increase year over year, surpassing the consensus estimate of $1.11 [2] - Total sales for the quarter were $1.065 billion, nearly matching the consensus of $1.061 billion, reflecting a 5% year-over-year increase and 3% organic growth [2] - The CooperVision segment generated sales of $709.6 million, a 5% increase from the previous year's fourth quarter, with 3% growth in constant currency and organically [3] - CooperSurgical reported revenue of $355.6 million, up 4% year over year, with consistent growth in constant currency and organically [3] Future Outlook - For the first quarter of 2026, the company expects sales between $1.019 billion and $1.030 billion, compared to the consensus of $1.025 billion, with adjusted earnings projected at $1.02 to $1.04 per share against a consensus of $1.00 [4] - The company anticipates organic growth of 3% to 4% for 2026 and adjusted earnings for fiscal 2026 to be between $4.45 and $4.60 per share, exceeding the consensus of $4.09 [4] - Projected sales for fiscal 2026 are estimated to be between $4.299 billion and $4.338 billion, compared to the consensus of $4.089 billion [4] - Free cash flow for fiscal 2026 is expected to be between $575 million and $625 million, with projections of over $2.2 billion in free cash flow from fiscal 2026 to fiscal 2028 [5] Analyst Reactions - Needham maintains a Buy rating and raises the price target from $94 to $100 [6] - Mizuho keeps an Outperform rating and increases the price target from $85 to $100 [6] - Baird maintains an Outperform rating and raises the price target from $85 to $98 [6] - JP Morgan retains a Neutral rating and raises the price target from $66 to $78 [6] - Wells Fargo maintains an Equal-Weight rating and increases the price target from $72 to $82 [6]