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Cooper Earnings Preview

Investors are on the edge of their collective seats, hoping that Cooper (NYSE: COO  ) will top analyst expectations for the fifth consecutive quarter. The company will unveil its latest earnings on Thursday, Dec. 8. Cooper develops, manufactures, and markets health-care products, primarily medical devices, through its two business units: CooperVision and CooperSurgical.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Cooper, with five out of eight rating it a buy and the remainder rating it a hold. Analysts like Cooper better than competitor Teleflex overall. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $356.9 million in revenue this quarter. That would represent a rise of 13.9% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $1.21 per share. Estimates range from $1.18 to $1.23.

What our community says:
CAPS All-Stars are split on Cooper, with 46.2% rating it an outperform and 53.8% giving it an underperform rating. Fools are bearish on Cooper, though the message boards have been quiet lately, with only 42 posts in the past 30 days. Cooper's bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Cooper's profit has risen year over year by an average of more than threefold over the past five quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters. 

Quarter Q3 Q2 Q1 Q4
Gross Margin 57.7% 62% 60.2% 59.8%
Operating Margin 13.1% 18.5% 18.7% 19.9%
Net Margin 10.9% 10.9% 15.4% 15.4%

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Earnings estimates provided by Zacks.


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DocumentId: 1736460, ~/Articles/ArticleHandler.aspx, 5/26/2012 8:48:10 PM

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