Cooper (COO) To Report Q2 Earnings: What's In The Cards?

The Cooper Companies Inc. (NYSE:COO) is set to report second-quarter fiscal 2017 results after the market closes on Jun 1.

Cooper Companies has an impressive track of beating estimates in the trailing four quarters. In the last reported quarter, the company delivered a positive earnings surprise of 3.76%, bringing the four-quarter average to 3.30%. Let’s see how things are shaping up prior to this announcement.

Factors at Play

We believe that the growing presence of Cooper Companies in the fertility segment will drive top-line growth. The company’s focus on genetic testing will also continue to drive growth in our view. Cooper Companies is expected to maintain a leading position in the markets of speciality lenses with exclusive products like Bioinfinity, Clarity and silicone hydrogel lenses. Its growing presence in the women's healthcare market through accretive acquisitions is also a positive in our view.

In the last three months, Cooper Companies returned almost 9.23%, outperforming the Zacks categorized Medical/Dental-Supplies sub-industry’s gain of roughly 5.96%.

Of the major concerns, an unfavorable foreign exchange rate, intense competition and a volatile distributor base might dent the company’s results in the to-be reported quarter.

Overall activities of Cooper Companies during the second quarter were inadequate to win analysts’ confidence. As a result, the Zacks Consensus Estimate for the quarter fell to $2.25 from $2.27 per share in the last 90 days.

Earnings Whispers

However, our proven model does not conclusively show that Cooper Companies is likely to beat on earnings this quarter. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here, as you will see below.

Zacks ESP: Cooper Companies currently has an Earnings ESP of 0.00%. This is because the Most Accurate estimate and the Zacks Consensus Estimate stand at $2.25. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: Cooper Companies currently carries a Zacks Rank #2 which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult.

We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat:

Best Buy Co. Inc. (NYSE:BBY) has an Earnings ESP of +12.50% and a Zacks Rank #3. On average, the stock delivered a positive surprise of almost 27.70% in the last four quarters.

Global Partners LP (NYSE:GLP) delivered a positive surprise of almost 96.55% in the trailing four quarters. It has an Earnings ESP of +233.33% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Raymond James Financial, Inc. (NYSE:RJF) has an Earnings ESP of +3.45% and a Zacks Rank #1. The stock delivered a positive surprise of almost 14.4% in the last four quarters.

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