Breaking Down The Cooper Companies, Inc. (COO) Financial Health: Key Insights for Investors

If you're looking at The Cooper Companies, Inc. (COO), you need to look past the surface-level growth and see where the real pressure points are. The company is projecting a solid full-year 2025 revenue between $4.076 billion and $4.096 billion, representing an organic growth rate of 4% to 4.5%, with non-GAAP diluted earnings per share (EPS) expected to land between $4.08 and $4.12. That's a decent trajectory, but honestly, the headline numbers hide a near-term risk: the company had to cut its revenue guidance in Q3 due to a noticeable slowdown in contact-lens demand across Asia, especially China. Still, management is defintely confident, backing the stock with a massive $2.0 billion stock repurchase authorization announced in September 2025, which gives you a clear signal that they see the stock as undervalued. We need to figure out if the strength of CooperVision's product lines, like MyDay, can overcome those geographic headwinds and justify the analyst consensus of a Moderate Buy rating.

Revenue Analysis

You're looking for a clear picture of where The Cooper Companies, Inc. (COO) actually makes its money, and that's smart. The direct takeaway is that this is a tale of two businesses, with the Vision segment providing the bulk of the revenue and the Surgical segment offering higher-risk, but still necessary, diversification.

For the full fiscal year 2025, The Cooper Companies, Inc. is projecting total sales to land between $4,076 million and $4,096 million, which represents an organic growth rate of 4% to 4.5% year-over-year. That's defintely solid growth for a mature medical device company, but you need to see the engine driving it.

The Dual Engines: CooperVision and CooperSurgical

The company's revenue streams are cleanly split into two primary, distinct medical device segments. The lion's share comes from CooperVision (CVI), which focuses on soft contact lenses, including single-use, multifocal, and toric lenses. The smaller, yet vital, segment is CooperSurgical (CSI), which provides women's health and fertility solutions, covering everything from surgical instruments to assisted reproductive technology tools.

Here's the quick math on segment contribution for FY 2025, based on the company's guidance:

CooperVision is the steady, reliable cash cow, projected to bring in roughly two-thirds of the total revenue, or about $2.7 billion. Its organic growth is forecast to be slightly higher, between 4% and 5%. Key product lines like MyDay and MiSight are the main growth drivers here.

Near-Term Risks and Growth Opportunities

The overall year-over-year revenue growth is healthy, but the story isn't perfectly smooth. In the third quarter of 2025, total revenue was $1,060.3 million, a 5.7% year-over-year jump. CooperVision's Q3 sales were $718.4 million, growing a strong 6%. That segment is performing well globally, driven by gains in the Americas and EMEA regions.

But, you need to watch CooperSurgical closely. While its Q3 revenue was $341.9 million, up 4% year-over-year, its operating income actually declined. This weakness stemmed from a product-line exit and related write-offs. What this estimate hides is that a product-line exit can be a one-time clean-up, but it's still a drag on immediate results and a signal to check the segment's long-term strategy. You can review the company's strategic focus in detail here: Mission Statement, Vision, & Core Values of The Cooper Companies, Inc. (COO).

The geographic breakdown also matters for CVI, with strong organic growth in the Americas, plus positive contributions from the EMEA (Europe, Middle East, and Africa) and Asia Pacific regions. This global diversification helps mitigate regional economic slowdowns. The core revenue is stable, but the surgical side requires more scrutiny. Your next step should be to look at the gross margin trends to see if the CVI segment's higher growth is translating into better overall profitability.

Profitability Metrics

The Cooper Companies, Inc. (COO) is demonstrating strong core operational profitability in fiscal year 2025, even with some short-term GAAP pressures. The key takeaway is that the company's non-GAAP margins-which strip out one-time costs like acquisitions and amortization-show solid expansion, reflecting excellent operational efficiency. For the full fiscal year 2025, management is projecting total revenue between $4,076 million and $4,096 million, with non-GAAP diluted earnings per share (EPS) expected to be in the range of $4.08 to $4.12.

When you look at the raw numbers, the GAAP margins for the third quarter of 2025 show a Gross Margin of 65% and an Operating Margin of 17%. This dip from the prior year is mostly due to a planned product line exit in the CooperSurgical segment. But honestly, the non-GAAP figures tell the real story of how the core business is performing. On a non-GAAP basis, the Gross Margin actually improved to 67%, and the Operating Margin hit a strong 26%. That's a defintely impressive operational leverage in a complex medical device business.

Here's the quick math on their operational efficiency, which is what the Operating Margin (profit after core expenses) really measures. The 26% non-GAAP operating margin in Q3 2025 is a 60-basis-point improvement year-over-year, driven by efficiency gains, a favorable product mix, and targeted expense control. This focus on cost management and product mix-like the continued growth in CooperVision's daily silicone hydrogel portfolio-is what keeps the gross margin high. A high gross margin is the first sign of pricing power and efficient production.

This level of profitability is strong when you compare it to the broader industry. A general benchmark considers an operating margin of 15% to 20% to be strong for most businesses. COO's GAAP Operating Margin of 17% is right in that strong range, but their non-GAAP figure of 26% is excellent, showing their core business is well-managed and highly profitable. The approximate Net Profit Margin of 10.39% also comfortably exceeds the average net margin of 8.54% across all industries. This performance underscores the company's ability to generate significant profit from its specialized medical device segments, CooperVision and CooperSurgical.

You need to keep an eye on the non-GAAP Operating Margin trend. It has risen by an average of 1.5 percentage points over the last five years, which signals that management is effectively gaining operating leverage-meaning revenue growth is outpacing the growth of operating expenses. This sustained margin expansion is a clear indicator of a high-quality business model. For a more comprehensive view of the company's financial standing, you should review the full analysis at Breaking Down The Cooper Companies, Inc. (COO) Financial Health: Key Insights for Investors.

Next Step: Finance/Investor Relations: Confirm the full-year 2025 non-GAAP net income estimate based on the raised EPS guidance to understand the net margin trajectory for the final quarter.

Debt vs. Equity Structure

The Cooper Companies, Inc. (COO) maintains a conservative and well-managed capital structure, relying far more on equity than debt to finance its growth, which is a key sign of financial stability. You can see this clearly in their Debt-to-Equity (D/E) ratio, which sits around 0.30 as of the third quarter of fiscal year 2025.

To put that in perspective, the median Debt-to-Equity ratio for the Surgical and Medical Instruments industry was around 0.70 in 2024. The Cooper Companies, Inc. is operating with less than half the leverage of its peers, which is defintely a strong position in a high-interest rate environment. This low leverage gives them significant financial flexibility for future acquisitions or economic downturns.

The company's total outstanding debt is approximately $2.5 billion, and it is structured primarily through two facilities. Here's the quick math on their financing arrangements:

• 2021 Term Loan: $\mathbf{\$1,500.0 \text{ million}}$ outstanding at a weighted-average rate of $\mathbf{5.30\%}$.
• 2024 Revolving Credit Facility: $\mathbf{\$930.2 \text{ million}}$ outstanding at a weighted-average interest rate of $\mathbf{5.43\%}$.

The good news is that their net debt declined to $\mathbf{\$2.35 \text{ billion}}$ in Q3 2025, and their bank-defined leverage ratio improved to 1.77x. Plus, interest expense was lower year-over-year at $\mathbf{\$24.7 \text{ million}}$ (non-GAAP) for the quarter, reflecting a lower average debt balance and slightly lower rates. That's a solid trend.

When it comes to balancing debt and equity, The Cooper Companies, Inc. is using its strong cash flow to fund growth and return capital to shareholders, not just service debt. They are actively managing their equity, evidenced by the $\mathbf{\$52.2 \text{ million}}$ used to repurchase 0.7 million shares of common stock during the third quarter of fiscal 2025. This share buyback program is a clear signal that management sees the stock as undervalued and prefers to use capital to boost shareholder value rather than relying on new equity issuance for funding. For a deeper dive into who is investing and why, check out Exploring The Cooper Companies, Inc. (COO) Investor Profile: Who's Buying and Why?

Liquidity and Solvency

You need to know if The Cooper Companies, Inc. (COO) can cover its near-term bills and sustain its growth investments. The short answer is yes: the company's liquidity position is strong, backed by a robust operating cash flow, but you should still watch the capital allocation decisions, especially around debt.

The Cooper Companies, Inc.'s balance sheet for the third quarter of fiscal year 2025 shows solid short-term financial health. The Current Ratio, which measures current assets against current liabilities, sits at a strong 2.12. This means the company has $2.12 in current assets for every dollar of current liabilities, providing a comfortable buffer against short-term obligations. Working capital-the difference between current assets and current liabilities-is substantial at approximately $1.13 billion (Current Assets of $2.14 billion minus Current Liabilities of $1.01 billion).

Here's the quick math on their immediate cash position:

• Current Ratio: 2.12 (Strong liquidity)
• Quick Ratio: 1.24 (Decent, but watch inventory)
• Working Capital: Approx. $1.13 billion (Q3 2025)

The Quick Ratio (or acid-test ratio), which excludes inventory from current assets, is 1.24 for the same period. The drop from the Current Ratio to the Quick Ratio signals that inventory is a significant component of their current assets. This is typical for a medical device company like COO, but it's a reminder that converting that inventory to cash takes time. Still, a Quick Ratio above 1.0 is a defintely good sign; they can cover current debt even if sales slow down.

Looking at the cash flow statement for Q3 2025, the core business is a cash-generating machine. Net cash from continuing operating activities was a robust $261.5 million. This is the lifeblood of the company, showing strong, repeatable cash generation from selling contact lenses and women's health products. This operating strength is what supports their long-term strategy.

However, the other two cash flow sections show where the money is going:

Investing cash flow is consistently negative, with net cash from continuing investing activities at -$98.1 million in Q3 2025. This is not a concern; it reflects ongoing capital expenditures and strategic acquisitions, which are necessary for future capacity and growth. The Financing cash flow is more volatile. In Q3 2025, The Cooper Companies, Inc. issued $756 million in debt, which was partially offset by repurchasing $52.1 million of common stock. This suggests a flexible but active capital strategy, balancing growth funding with shareholder returns. The full fiscal year 2025 free cash flow is projected to be roughly $385 million.

The main strength is the high-quality operating cash flow. The potential liquidity concern isn't about immediate survival but rather the volatility in financing, which can affect the cash balance. To dig deeper into who is betting on this strategy, check out Exploring The Cooper Companies, Inc. (COO) Investor Profile: Who's Buying and Why?

Valuation Analysis

You're looking at The Cooper Companies, Inc. (COO) after a rough year for the stock, and the core question is simple: is this dip a buying opportunity or a signal of deeper trouble? The short answer is that, based on forward-looking earnings, the stock looks reasonably valued, but the trailing metrics still reflect a premium for its growth segments.

The Cooper Companies, Inc.'s stock has fallen sharply, dropping about 27.4% over the last 12 months, which is a significant underperformance compared to the broader market. The stock is currently trading around the $72.00 mark, well off its 52-week high of $106.63. This price action is what makes the valuation ratios so critical right now.

Here's the quick math on where The Cooper Companies, Inc. stands against its own earnings and assets, using the latest available fiscal year 2025 data and trailing twelve months (TTM) figures:

• Price-to-Earnings (P/E): The TTM P/E is high at 35.37, reflecting a high price relative to the last year's GAAP earnings per share of $2.04.
• Forward P/E: This drops dramatically to around 16.72, based on the non-GAAP diluted EPS guidance of $4.08 to $4.12 for fiscal year 2025.
• Enterprise Value-to-EBITDA (EV/EBITDA): This is a respectable 15.00, using a TTM EBITDA of approximately $1.11 billion.
• Price-to-Book (P/B): The P/B ratio stands at 1.72 as of November 2025.

The gap between the trailing and forward P/E tells the story: the market is pricing in a strong earnings recovery for the full 2025 fiscal year. A forward P/E of 16.72 is defintely not cheap for a medical device company, but it's not wildly overvalued either, especially considering the strong growth potential in its CooperVision and CooperSurgical segments. The EV/EBITDA of 15.00 also suggests a fair, but not discounted, valuation relative to the cash flow generated from its $16.70 billion Enterprise Value.

The Cooper Companies, Inc. is not a dividend play; its Trailing Annual Dividend Yield is 0.00%. Instead of dividends, the board authorized a $2.0 billion stock buyback plan in September, which is a strong signal that management believes the stock is undervalued at current levels. This is a concrete action that can support the stock price and boost future earnings per share.

Analyst sentiment is generally positive, with a consensus rating of Moderate Buy or Buy from the fifteen analysts covering the stock. The average 12-month price target is approximately $81.88, which suggests an upside of about 13.7% from the current price. The range is wide, from a low of $64.00 to a high of $96.00, reflecting the uncertainty around the timing of the expected earnings recovery. For a deeper dive into who is buying and why, you should check out Exploring The Cooper Companies, Inc. (COO) Investor Profile: Who's Buying and Why?

What this estimate hides is the risk from soft demand in Asia, particularly China, which led to a revenue guidance cut in Q3 2025. The opportunity lies in the successful rollout of new products like MyDAY® contact lenses, which management expects to drive improving revenue in Q4 2025 and into fiscal 2026.

Risk Factors

You need a clear-eyed view of The Cooper Companies, Inc. (COO)'s financial vulnerabilities, not just the growth story. While the company is well-positioned in specialized healthcare markets, several near-term risks-both internal and external-could pressure the bottom line and temper the stock's volatility, which has seen a 52-week range between $64.32 and $105.21 as of November 2025. The direct takeaway is that regulatory and operational risks are the most immediate threats to margin expansion, requiring a close watch on execution.

Operational and Financial Headwinds

The company's financial health in the 2025 fiscal year, while generally solid, shows specific areas of strain. One significant internal issue is the disclosure of a material weakness in IT general controls within the CooperSurgical segment, which raises a red flag for operational risk management and investor confidence. Furthermore, the growth trajectory has been moderating; Q3 2025 revenue of $1.06 billion represented a 5.7% year-over-year increase, which was a deceleration from earlier periods. This slowing is particularly acute in the CooperSurgical fertility segment, which saw only 3% year-over-year growth in Q3 2025, reflecting sensitivity to broader macroeconomic cycles, especially in Asia-Pacific markets.

Here's the quick math: The full-year 2025 revenue guidance was recently adjusted to a tighter range of $4.08 billion to $4.10 billion, a slight dip from prior estimates, suggesting management is acknowledging these headwinds. This is a defintely a watch item.

• Slowing segment growth: CooperSurgical fertility segment growth at only 3% in Q3 2025.
• IT control weakness: A material weakness was disclosed in CooperSurgical's IT general controls.
• Product transition risk: Challenges in moving CooperVision customers from Clarity to the premium MyDay product family.

External and Regulatory Pressures

External factors, particularly regulatory changes and geopolitical trade tensions, are actively squeezing margins. The European Union's Medical Device Regulation (MDR) and In Vitro Diagnostic Regulation (IVDR) are forcing industry-wide cost adjustments, complicating supply chains, and acting as a direct pressure on the gross margin, which was 67.3% in Q3 2025. Additionally, U.S. tariffs and foreign exchange (FX) volatility introduce layers of financial uncertainty. The company expects a rough 0.5% headwind to fiscal 2025 revenue from currency fluctuations alone. You also have to consider the intense competition in the contact lens market, which drives pricing pressures in key markets for CooperVision.

Mitigation and Strategic Actions

The Cooper Companies, Inc. is not standing still. The primary mitigation strategy is a strong focus on innovation and operational efficiency. The improvement in gross margin to 67.3% in Q3 2025 is a direct result of efficiency gains and a strategic shift towards higher-margin, premium products like MyDay contact lenses. The firm is also aggressively reinvesting in its future, with R&D expenses increasing by 21% in Q2 2025, a clear signal of prioritizing new product development to overcome competitive and regulatory hurdles. This focus is supported by a strong capital position, with an expected 2025 free cash flow (FCF) between $350 million and $400 million. This allows for both organic investment and strategic acquisitions, like obp Surgical, to strengthen the portfolio.

For more detailed analysis, you can read the full post: Breaking Down The Cooper Companies, Inc. (COO) Financial Health: Key Insights for Investors

Growth Opportunities

You're looking at The Cooper Companies, Inc. (COO) and asking the right question: where does the next wave of growth come from? The short answer is a continued, intentional push into premium, high-margin products, especially in specialty contact lenses and women's health. It's not about massive market expansion; it's about taking share in high-value niches.

For the 2025 fiscal year, the company projects total revenue to land between $4,076 million and $4,096 million, reflecting an organic growth rate of 4% to 4.5%. That's solid, defensible growth, not explosive, but defintely reliable. The non-GAAP diluted earnings per share (EPS) is expected to be in the range of $4.08 to $4.12. Here's the quick math: the bulk of that growth is driven by their two distinct segments, CooperVision and CooperSurgical, each with its own powerful engine.

Product Innovation and Market Expansion

The core growth driver for The Cooper Companies, Inc. is product innovation, which translates directly into market share gains. They are not just selling contact lenses; they are selling solutions for complex vision issues. This is their competitive edge.

• Myopia Management: The MiSight product line, which addresses the growing global prevalence of nearsightedness (myopia) in children, is a massive opportunity. This segment grew 35% year-over-year in Q3 2025 and is on track to surpass $100 million in fiscal 2025 sales. This is a premium, recurring revenue stream.
• Daily Silicone Hydrogel Lenses: The MyDay family of lenses continues to be a powerhouse. These daily disposable lenses offer superior comfort and health, which drives higher adoption and repeat purchases. CooperVision's overall organic growth is projected to be higher than the CooperSurgical segment for the year, at 4% to 5%.
• Women's Health Portfolio: On the CooperSurgical side, the strength lies in surgical medical devices and the labor and delivery portfolio, plus the continued success of the PARAGARD intrauterine device (IUD). While the broader fertility market saw some softness in 2025, the segment's organic growth is still projected at a respectable 3% to 3.5%.

The company is also strategically expanding its reach. For instance, the launch of MyDay Energys in Canada and the upgraded Clarity One Day Sphere in Japan are clear examples of targeted geographic and product rollouts designed to accelerate revenue in the fiscal fourth quarter.

Strategic Initiatives and Competitive Moats

The Cooper Companies, Inc. is using its financial strength to reinforce its position. They are a leader in the global contact lens market, which provides a solid foundation. Their business model, which is split between vision care and women's health, is a major competitive advantage (diversification), insulating them from a downturn in any single niche. Mission Statement, Vision, & Core Values of The Cooper Companies, Inc. (COO).

From a capital allocation perspective, they are making smart moves. They project generating around $2 billion in free cash flow over the three fiscal years ending in 2028, which funds both reinvestment and shareholder returns. In September 2025, the Board authorized a new $2.00 billion stock buyback plan, signaling management's belief that the stock is undervalued and a commitment to returning capital. They've also used strategic acquisitions, like obp Surgical and Cook Medical, to expand their surgical portfolio and innovation pipeline, which is how you buy growth when organic growth slows.

Here is a breakdown of the 2025 fiscal year guidance by segment, based on the August 2025 update:

What this estimate hides is the potential impact of their premium mix shift. Even if the overall market for contact lenses grows at a moderate pace, the shift toward higher-priced, higher-margin products like MyDay and MiSight means their revenue growth is qualitatively better, driving gross margins up. Finance: draft a sensitivity analysis on the impact of a 1% shift in mix toward MySight on total gross margin by Friday.