What's In Store For Cooper Companies (COO) Q1 Earnings?

The Cooper Companies, Inc.’s (NYSE:COO) first-quarter fiscal 2020 results are scheduled to release on Mar 5, after the closing bell.

In the last reported quarter, the company delivered a positive earnings surprise of 0.9%. Further, it has a trailing four-quarter positive earnings surprise of 6.2%, on average.

Fiscal Q1 Estimates

For the first quarter, the Zacks Consensus Estimate for revenues is pegged at $647.9 million, suggesting growth of 3.2% from the year-ago quarter’s reported figure. The same for earnings stands at $2.71 per share, indicating a decline of 5.9% from the year-ago reported figure.

Factors to Influence Fiscal Q1

Cooper Companies reports revenues under two major segments — CooperVision (CVI) and CooperSurgical (CSI).

Better-than-expected performance across the Americas, Asia-Pacific and EMEA is likely to have generated higher revenues at the company’s CVI segment in the fiscal first quarter. Further, accelerating growth in both Clariti and MyDay and higher revenues from Single-use sphere lenses is likely to have contributed to the to-be-reported quarter’s revenues.

In fact, it is encouraging to note that for fiscal first quarter 2020, the company expects CVI sales of $480-$$490 million, indicating year-over-year growth of 3-5% at constant currency (cc).

Additionally, CVI’s Toric and Multifocal lenses, which make Cooper Companies a dominant force in the soft contact lenses market, are likely to have driven the fiscal first-quarter results.

Management at Cooper Companies anticipates witnessing higher contact lenses demand, owing to the global transition to daily contact lenses by customers. Moreover, the company has made advancements in customized product offerings, which are likely to have ramped up the fiscal first-quarter sales.

The company’s CSI segment is likely to report revenue growth in the to-be-reported quarter backed by strength in Cooper’s device portfolio, which includes consumable products like IVF media and the market-leading Wallace Embryo needles and transfer catheters.

It is encouraging to note that for fiscal first quarter, Cooper Companies expects CSI sales of $158-$163 million, thereby reflecting growth of flat to 4% at cc on a year-over-year basis.

The company is likely to have generated bottom-line growth in the fiscal first quarter, primarily driven by its market-leading products and solid operational execution. The company expects adjusted earnings per share to range between $2.65 and $2.75.

It is important to note here that Cooper Companies generates a significant part of its revenues in foreign currencies. Consequently, adverse forex can affect the company’s overseas revenues.

Notably, Cooper Companies anticipates foreign exchange headwinds to have an impact of $11 million on revenues in fiscal 2020. Consequently, a similar trend is likely to have continued in the to-be-reported quarter.

What Our Quantitative Model Suggests

Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is the case here as you will see below.

Earnings ESP: Cooper Companies has an Earnings ESP of +0.63%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: The company carries a Zacks Rank #3.

Peer Releases

Here are three stocks that reported solid results for this earnings season.

Stryker Corporation (NYSE:SYK) delivered fourth-quarter 2019 adjusted EPS of $2.49, outpacing the Zacks Consensus Estimate by 1.2%. Fourth-quarter reported revenues of $4.13 billion surpassed the Zacks Consensus Estimate by 0.7%. The company carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Accuray Incorporated (NASDAQ:ARAY) reported second-quarter fiscal 2020 adjusted earnings per share (EPS) of a penny, beating the Zacks Consensus Estimate of a loss of 7 cents. Net revenues of $98.8 million outpaced the Zacks Consensus Estimate by 0.3%. The company sports a Zacks Rank #2.

IDEXX Laboratories, Inc. (NASDAQ:IDXX) reported fourth-quarter 2019 adjusted EPS of $1.04, which beat the Zacks Consensus Estimate of 91 cents by 14.3%. Revenues were $605.4 million, surpassing the Zacks Consensus Estimate by 0.9%. The company carries a Zacks Rank of 2.

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