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Develops, manufactures and markets healthcare products, primarily medical devices through its two business units, CooperVision, Inc. (CVI) and CooperSurgical, Inc. (CSI).
This a competion pick against my friend. He subscribes to the view that the recent quarter was a reset quarter. The write downs of equipment, and the lowered outlook were to help the new management start with a clean slate. I took away a very different view from the events that transpired today (12.12.07).Here's what made me uneasy:*Missed earnings and I don't care why, that's bad.*Beat on revenue. (I didn't know dividends were paid out in revenue)*Lower margins (barf)*Lowered guidence (Who would wipe out market value to give management an easier bar to clear? Those people own the stock)*Huge amounts of debt 861m vs a market cap of 1.77B*Trailing P/E > 66.50
Considering I'm down 11 points on this little fella, I decided to take another look at the pick. I'm not excited that the insiders have been buying on a steady basis since January. The institutions are selling and the short sellers believe there is more pain to come. *Debt has increased to 925m, awesome. *The company is split into two segments, CVI (the vision portion of the business) and CSI (the hit crime show ... check that, surgical segment). CVI is by far the bigger contributer to revenue, posting 205.5m in sales vs a 39.5m for CSI last quarter. CVI has had solid growth in both Europe and Asia of 16%.*I actually found nothing concerning in the most recent 10-Q statement.*Can someone tell me why contact lens prices are fixed at $40 a box?
Company currently has a "Buy" rating from the very short-term oriented Zacks.com, and starting an "Underperform pick while that lasts is not good strategy in my experience. But since the valuation numbers are all bad I probably will start one when Zacks lowers this to "Hold".
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