Cooper Companies Shares Plunge 16% on Weak Guidance
Disappointing outlook for its core vision and surgical units overshadows Q3 earnings beat, prompting analyst downgrades.
Shares of Cooper Companies (COO) plummeted approximately 16% in heavy trading after the medical device maker issued a disappointing forward guidance that overshadowed a third-quarter earnings beat. The weak forecast for its CooperVision (CVI) and CooperSurgical segments triggered a wave of analyst price target cuts and spooked investors.
For its fiscal third quarter of 2025, the company reported a 5.7% year-over-year revenue increase to $1.06 billion and a 15% rise in non-GAAP earnings per share to $1.10. However, the positive results were completely eclipsed by the company's outlook. The CVI segment posted organic growth of just 2%, its weakest performance since the Great Recession, according to analysts at Piper Sandler.
The market reaction was swift and severe, with trading volume surging to more than five times the daily average. In response to the soft guidance, Piper Sandler slashed its price target on Cooper's stock to $83 from $105, although it maintained an 'Overweight' rating, citing potential long-term value.
In a statement, CEO Al White acknowledged the results, noting that revenue fell short of expectations due to 'Clarity demand and e-commerce challenges in Asia Pac.' For its upcoming fourth quarter, Cooper projects consolidated revenue between $1.05 billion and $1.07 billion, representing modest organic growth of 2% to 4%. This forecast suggests that the headwinds affecting its core businesses are likely to persist in the near term.
Despite the challenges, Cooper's management expressed confidence in its long-term strategy, highlighting strong operational metrics and reaffirming its belief that it will outperform the contact lens market in fiscal 2026. The company also demonstrated a commitment to returning value to shareholders, repurchasing $52.1 million of its common stock during the third quarter.