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Cooper Companies (COO) Q1 Earnings & Revenues Beat Estimates

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The Cooper Companies, Inc. COO reported first-quarter fiscal 2022 adjusted earnings per share (EPS) of $3.24, which beat the Zacks Consensus Estimate of $3.08 by 5.2%. The bottom line improved 2% on a year-over-year basis.

GAAP EPS in the fiscal first quarter was $1.91, compared with the year-ago EPS of $42.31 due to a substantial deferred tax benefit recorded in the prior-year period.

Revenue Details

Revenues of this Zacks Rank #3 (Hold) company were $787.2 million in the quarter under review, surpassing the Zacks Consensus Estimate by 6.8%. On a year-over-year basis, the top line improved 16% and surged 19% at constant currency (cc).

Fiscal Q1 Segment Details

CooperVision (CVI)

The segment’s revenues totaled $561.5 million, up 14% at cc and 11% on a reported basis.

Per management, the segment saw an increase in revenues from Single-use sphere lenses (30% of CVI), reflecting an improvement of 18% at cc and 14% on a reported basis. Single-use sphere lenses revenues totaled $167 million.
Toric (32% of CVI) revenues amounted to $182.2 million, up 16% at cc and 12% on a reported basis.

Multifocal (12% of CVI) generated revenues of $65.8 million, up 18% at cc and 14% on a reported basis.

Non-single-use sphere (26% of CVI) revenues were $146.5 million, up 7% at cc and 4% from the year-ago quarter.

Geographically, the segment witnessed an improvement in revenues in the Americas (38% of CVI), up 7% on a reported basis and 8% at cc to $215.5 million.

EMEA revenues (38% of CVI) totaled $213.5 million, up 13% year over year and 19% at cc.

Asia Pacific sales (24% of CVI) improved 13% at cc and 19% year over year to $132.5 million.

The Cooper Companies, Inc. Price, Consensus and EPS Surprise

The Cooper Companies, Inc. Price, Consensus and EPS Surprise
The Cooper Companies, Inc. Price, Consensus and EPS Surprise

The Cooper Companies, Inc. price-consensus-eps-surprise-chart | The Cooper Companies, Inc. Quote

CooperSurgical (CSI)

The segment reported revenues of $225.7 million, up 33% at cc and 30% on a year-over-year basis.

Sub-segment Office and Surgical products (57% of CSI) generated $128.9 million in revenues, up 25% at cc and 24% on a year-over-year basis.

Fertility (43% of CSI) revenues were $96.8 million, up 38% year over year and 45% at cc.

Margin Analysis

In the fiscal first quarter, gross profit was $518.4 million, up 15% year over year. Gross margin was 65.9% of net revenues, down 30 basis points (bps) year over year.

Meanwhile, selling, general and administrative expenses rose 22.2% to $319.1 million. Research and development expenses increased 22.4% year over year to $26.2 million.

Operating income in the quarter totaled $130.8 million, which fell 1.9% year over year. Operating margin was 16.6%, down 300 bps from the prior-year quarter.

Financial Position

The company exited the first quarter of fiscal 2022 with cash and cash equivalents of $280.7 million, up from $95.9 million at the end of fiscal fourth-quarter 2021.

Net cash provided by operating activities at the end of the fiscal first quarter was $166 million.

Fiscal 2022 Guidance

Cooper Companies has updated its financial guidance for the fiscal year 2022 after taking into account the ongoing global risks.

For fiscal 2022, the company projects total revenues between $3.26 billion and $3.33 billion, thereby reflecting 6.5% to 8.5% organic growth. The Zacks Consensus Estimate for the same is currently pegged at $3.24 billion.

CVI revenues are estimated to be $2.22-$2.26 billion (organic growth of 7-9%). CSI revenues are expected to lie within $1.04-$1.07 billion, thereby implying an organic growth of 5-7%.

Adjusted EPS is anticipated to be $13.70-$14.20. The Zacks Consensus Estimate for the same currently stands at $14.21.

Wrapping Up

Cooper Companies exited the fiscal first quarter on a strong note, wherein both earnings and revenues beat their respective consensus mark. The company witnessed solid performance across its core CVI and CSI units during the quarter under review, along with robust geographical performances. A solid financial outlook amid persistent pandemic-led challenges raises optimism.

Per management, the company continues to witness success with its daily silicone hydrogel lenses that positions it as one of the leaders in the soft contact lens market. The company remains optimistic about its myopia management program, which comprises MiSight and Ortho K lenses, and sustained strength in fertility.

However, an increase in selling, general and administrative expenses is concerning. Contraction in both gross and operating margins is disappointing.

Earnings of Other MedTech Majors at a Glance

Some better-ranked stocks in the broader medical space that have announced quarterly results are Henry Schein, Inc. HSIC, Quidel Corporation QDEL and Bio-Rad Laboratories, Inc. BIO.

Henry Schein, carrying a Zacks Rank #1 (Strong Buy), reported fourth-quarter 2021 adjusted earnings of $1.07 per share, which beat the Zacks Consensus Estimate by 18.9%. Revenues of $3.33 billion outpaced the consensus mark by 4.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Henry Schein has an estimated long-term growth rate of 11.8%. HSIC surpassed earnings estimates in each of the trailing four quarters, the average surprise being 25.5%.

Quidel reported fourth-quarter 2021 adjusted EPS of $7.29, which surpassed the Zacks Consensus Estimate by 49.1%. Fourth-quarter revenues of $636.9 million outpaced the Zacks Consensus Estimate by 0.3%. It currently carries a Zacks Rank #1.

Quidel’s earnings yield of 8.4% compares favorably with the industry’s (0.7%). QDEL surpassed earnings estimates in two of the trailing four quarters and missed twice, the average surprise being 129.4%.

Bio-Rad reported fourth-quarter 2021 adjusted EPS of $3.21, which surpassed the Zacks Consensus Estimate by 11.9%. Fourth-quarter revenues of $732.8 million outpaced the Zacks Consensus Estimate by 0.5%. It currently has a Zacks Rank #2 (Buy).

Bio-Rad has an earnings yield of 2.3%, which compares favorably with the industry’s negative yield. BIO surpassed earnings estimates in each of the trailing four quarters, the average surprise being 66.9%.


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