On Mar 19, Zacks Investment Research upgraded
The Cooper Companies Inc.
) to a Zacks Rank #2 (Buy) from a Zacks Rank #3 (Hold).
Why the Upgrade?
The Cooper Companies has been enjoying rising earnings estimates
in the last one month, riding on strong fiscal 2014 first-quarter
results and a promising guidance for fiscal 2014. Moreover, this
global medical device company has delivered positive earnings
surprises in 3 of the last 4 quarters.
Following the earnings release on Mar 6, shares of The Cooper
Companies climbed 5.1% to $137.62 till the last closing date.
The Cooper Companies posted adjusted earnings of $1.47 per share
for the quarter, exceeding the year-ago level of $1.23 by 19.5%
and the Zacks Consensus Estimate by 2 cents per share. Revenues
in the quarter grew 7% to $405.0 million, edging past the Zacks
Consensus Estimate by $5.0 million.
Furthermore, the company reported an improvement of 200 basis
points each in the gross and operating margins for the quarter.
Gross margin was positively impacted by a lower royalty payment
on silicone hydrogel lens sales and favorable product mix,
whereas the increase in operating margin was driven by higher
gross margin and a decline in selling, general &
administrative expenses as a percentage of sales (39.0% in
first-quarter 2014 from 39.7% in first-quarter 2013).
The Cooper Companies revised its fiscal 2014 total revenue
guidance to the range of $1,685-$1,725 million compared with the
prior guidance of $1,675-$1,735 million. The revised revenue
guidance represents an increase of 6.1-8.6% from fiscal 2013.
Both reported and adjusted earnings per share for the year are
expected in the range of $6.75-$7.00 compared with the earlier
guided range of $6.70-$7.00. The revised earnings guidance
indicates a rise of 13.4-17.6% from fiscal 2013.
Over the last 30 days, The Cooper Companies saw five upward
estimate revisions for fiscal 2014 with no downward revision over
the same time frame, thus, leading to a 0.6% rise in the Zacks
Consensus Estimate to $6.86 per share.
The long-term expected earnings growth for this stock is pegged
higher at 14.3% compared with industry growth of 13.5%.
Other Stocks to Consider
Some other stocks worth reckoning in the medical/dental supply
Align Technology Inc.
CR Bard Inc.
Becton, Dickinson and Company
). All the three stocks hold a similar Zacks Rank #2.
ALIGN TECH INC (ALGN): Free Stock Analysis
BARD C R INC (BCR): Free Stock Analysis
BECTON DICKINSO (BDX): Free Stock Analysis
COOPER COS (COO): Free Stock Analysis Report
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