Cooper Companies' Innovation Fuels Growth Amid Macro Headwinds

The Cooper Companies, Inc.’s COO strategic investments in innovation and its diversified product base support long-term growth. However, near-term macro and inventory challenges, particularly in fertility and global consumer spending, require careful monitoring. Investors should weigh the company's solid execution against sector-specific and macro uncertainties.Shares of this Zacks Rank #3 (Hold) company have lost 20% so far this year compared with the industry's 2.3% decline. The S&P 500 Index has increased 9.6% in the said time frame.The Cooper Companies, with a market capitalization of $14.65 billion, is a global specialty medical device company.Image Source: Zacks Investment ResearchThe company’s bottom line is estimated to improve 10.1% over the next five years. Its earnings beat estimates in three of the trailing four quarters and met in one, delivering an average surprise of 3.18%.What's Driving COO’s Performance?Strong Execution and Margin Expansion:COO delivered solid organic top-line growth and improved margins, with adjusted earnings per share (EPS) up 14% year over year to 96 cents. Operating margin expanded to 24.9%, driven by efficiency gains, OpEx leverage and disciplined cost management. This demonstrates COO's operational resilience even amid macro softness.Product Innovation and Growth in Premium Segments:The MyDay daily silicone hydrogel lenses and MySight myopia management products are gaining traction, growing 10% and 35%, respectively, year over year. Continued expansion in toric and multifocal ranges, new product launches (e.g., MyDay Energys) and private label wins suggest sustained future revenue momentum.Strength in Surgical Portfolio and Office-Based Products:CooperSurgical posted 8% revenue growth, with notable strength in office-based surgical devices (up 13%) and PARAGARD IUD (up 18%). Despite fertility softness, other categories in surgical remain robust, providing diversification and a buffer to near-term fertility pressures.What's Weighing on the Stock?Fertility Market Weakness and Soft Asia Trends: Fertility revenue growth slowed to 3%, with ongoing cycle declines in Asia Pacific and deferred capital spending by clinics. Management now expects low-single-digit growth for the fertility segment in fiscal 2025 compared to previously higher expectations. This is indicative of cyclical weakness and potential consumer constraints.Inventory and Channel Destocking Headwinds: Channel inventory reductions across the contact lens market, along with patients buying shorter-term lens supplies, are pressuring revenue visibility. Even with strong underlying demand and fit data, COO acknowledged ongoing inventory pressures that could weigh on near-term growth.Tariff and FX Risks Cloud FY26 Outlook: COO expects a $4 million tariff hit to fiscal 2025 COGS and a 3% EPS headwind in fiscal 2026 if tariffs remain unchanged. While mitigations are planned, COO remains exposed to global supply-chain shifts and FX fluctuations, which could pressure future margins.The Cooper Companies, Inc. Price The Cooper Companies, Inc. price | The Cooper Companies, Inc. QuoteEstimate TrendThe Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $4.12 billion, implying growth of 5.7% from the year-ago reported figure. The consensus mark for adjusted EPS is pinned at $4.06, indicating an improvement of 10% from the previous year’s recorded level.In the past 60 days, COO’s earnings estimate for fiscal 2025 has moved north by 1 cent.Key PicksSome better-ranked stocks in the broader medical space that have announced quarterly results are Medpace Holdings, Inc. MEDP, West Pharmaceutical Services, Inc. WST and Boston Scientific Corporation BSX.Medpace Holdings, sporting a Zacks Rank #1 (Strong Buy) at present, reported second-quarter 2025 EPS of $3.10, which beat the Zacks Consensus Estimate by 3.3%. Revenues of $603.3 million outpaced the consensus mark by 11.5%. You can see the complete list of today’s Zacks #1 Rank stocks here.Medpace Holdings has a long-term estimated growth rate of 11.4%. MEDP’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 13.9%.West Pharmaceutical reported second-quarter 2025 adjusted EPS of $1.84, which beat the Zacks Consensus Estimate by 21.9%. Revenues of $766.5 million surpassed the Zacks Consensus Estimate by 5.4%. It currently flaunts a Zacks Rank #1.West Pharmaceutical has a long-term estimated growth rate of 8.5%. WST’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 16.8%.Boston Scientific reported second-quarter 2025 adjusted EPS of 75 cents, which beat the Zacks Consensus Estimate by 4.2%. Revenues of $5.06 billion surpassed the Zacks Consensus Estimate by 3.5%. It currently carries a Zacks Rank #2 (Buy).Boston Scientific has a long-term estimated growth rate of 14%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.1%.See our %%CTA_TEXT%% report – free today!7 Best Stocks for the Next 30 DaysWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Boston Scientific Corporation (BSX): Free Stock Analysis Report The Cooper Companies, Inc. (COO): Free Stock Analysis Report West Pharmaceutical Services, Inc. (WST): Free Stock Analysis Report Medpace Holdings, Inc. (MEDP): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks