High Gross Profit Margin
Strong Operating and Net Profit Margins
Strong Liquidity Ratios
Low Debt Levels
Record Revenues and Market Leadership
Strategic Focus on Innovation
Strong Margin Improvements
Solid Guidance for FY2025
Expansion in Growing Markets
High P/E Ratio
High EV/EBITDA Ratio
Low Return on Equity
Low Cash Ratio
Unforeseen Softness in Demand
Challenges in Manufacturing Capacity
Competition and Market Dynamics
Dependence on Key Innovations
Cooper Companies demonstrated robust performance with record revenues and strong market leadership in FY2024. However, challenges like unexpected demand softness and manufacturing capacity constraints could impact future growth. The company's focus on innovation and strategic expansion presents a positive outlook for FY2025, though it must navigate an increasingly competitive landscape.
Analysis Date: December 5, 2024
Last Updated: March 11, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$79.49
Current Market Price: $73.32
IV/P Ratio: 1.08x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
8.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for COO
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (35.73)
P/B ratio ≤ 1.5 (1.83)
Current ratio ≥ 2.0 (1.99x)
Long-term debt < Net current assets (2.52x)
Margin of safety (8.0%)
COO does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
The operating profit margin of 18.12% and net profit margin of 10.07% reflect effective cost management and a healthy bottom line.
A return on equity of only 4.98% suggests that the company is not effectively utilizing its equity base to generate profits.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
5.20%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
0.85%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
64.44%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
10.57%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
The current ratio of 1.91 and quick ratio of 1.12 indicate that the company has sufficient short-term assets to cover its short-term liabilities.
With a debt-to-equity ratio of 0.32 and a debt-to-assets ratio of 0.21, the company maintains a conservative leverage position, reducing financial risk.
A cash ratio of only 0.11 indicates that the company may face challenges in meeting immediate liabilities with cash reserves.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.31x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q1 2025
Current Ratio
Current assets divided by current liabilities
1.99x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q1 2025
Cooper Companies reported all-time record revenues of $3.9 billion for fiscal 2024, driven by both CooperVision and CooperSurgical. The company maintained its position as the number one contact lens company in the world, showcasing strong growth in silicone hydrogel dailies and torics.
The company is heavily focused on innovation, with plans to increase the availability of its innovative products and launch new ones. This includes the MyDay Energys lens and advancements in the myopia management sector.
Cooper Companies demonstrated strong margin improvements in FY2024, with consolidated operating income increasing by 16.2% and overall gross margins improving to 66.9%.
The company experienced unexpected softness in demand towards the end of Q4, particularly in the U.S. market, which raised concerns about potential volatility in sales.
Despite strong demand for MyDay products, the company faces challenges in meeting this demand due to manufacturing capacity constraints, which could limit growth potential in the short term.
The company has provided guidance indicating consolidated revenue growth of 6% to 8% for FY2025, which reflects confidence in continued market share gains and operational efficiency improvements.
Cooper Companies is poised for growth in the fertility sector, driven by favorable macro trends such as increasing patient awareness and improving access to treatment, with an expectation of organic growth in the mid-single digits for CooperSurgical.
The competitive landscape in the contact lens market is intensifying, with competitors launching new products that may challenge Cooper's market share and growth rates, highlighting the need for continued innovation.
The company's growth is heavily reliant on the success of key product launches such as MyDay and MiSight. Any delays or challenges in these product lines could impact future revenues.