The Cooper Companies, Inc.

(NASDAQ Global Select)
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Somewhat Bearish -25

Cooper Companies continues to see activist pressure to sell divisions, replace CEO

AI-generated analysis

πŸ“‰ Activist investor Jana Partners is lobbying Cooper Companies (NASDAQ: COO) to sell divisions and replace CEO Albert White following criticism of poor capital allocation.

πŸ“‰ The company lowered its 2026 annual growth forecast from roughly 4% to a range between 2% and 3%, citing problematic forecasting history.

πŸ’° Cooper Companies expanded its stock buyback program from $2 billion to $3 billion after repurchasing $445 million in shares this fiscal year.

πŸ›‘οΈ The board unanimously voted to retain the CooperSurgical division, rejecting external offers deemed insufficient due to competitive and litigation factors.

πŸ‘οΈ Revenue for the CooperVision segment remained largely flat at $717.0 million despite approximately $750 million in capital investments between 2023 and 2024.

πŸ“ˆ CooperSurgical reported third-quarter sales of $349.2 million, representing a 2% growth compared to the same period last year.

βš–οΈ Activist Jana Partners criticized management for serial negative surprises and expectation mismanagement in recent earnings reports.

πŸ”„ Another activist group, Browning West, previously urged the company to restructure as a pure-play vision care provider.

Bullish Signals
  • Cooper Companies expanded its stock buyback program from $2 billion to $3 billion following the repurchase of $445 million in shares this fiscal year.
  • The board unanimously voted to retain the CooperSurgical division, rejecting external offers that management deemed insufficient relative to the unit's value.
Risk Factors
  • Activist investor Jana Partners criticized the company for problematic forecasting, serial negative surprises, and poor capital allocation in a recent letter to the board.
  • The company lowered its 2026 annual growth forecast from approximately 4% down to a range between 2% and 3%, signaling reduced business momentum.
  • Revenue for the CooperVision segment remained largely flat at $717.0 million despite the company investing approximately $750 million in capital between 2023 and 2024.
Full Analysis
Activist investor Jana Partners is intensifying its campaign against the Cooper Companies (NASDAQ: COO), urging the board to sell off non-core divisions and replace CEO Albert White. In a recent letter, Jana criticized management for problematic forecasting, serial negative surprises, and poor capital allocation, specifically citing the company's lowered 2026 growth guidance from approximately 4% down to a range of 2% to 3%. The activist also highlighted concerns regarding flat revenue in the CooperVision segment despite significant capital investments made between 2023 and 2024. Cooper Companies recently completed an internal review of its CooperSurgical division, with the board unanimously deciding to retain the business rather than sell it. CEO Albert White explained that offers received for the unit did not reflect its true value, noting that temporary market factors such as new competitive entrants in the non-hormonal IUD market and a fertility litigation settlement influenced valuations. Despite activist pressure to divest, the company maintains its strategic position on holding onto CooperSurgical. To address shareholder concerns regarding capital efficiency, the company announced an expansion of its stock buyback program from $2 billion to $3 billion. This move follows the repurchase of $445 million in shares during the current fiscal year. While Jana Partners has also called for a new board chair and directors, another activist group, Browning West, previously urged the company to restructure as a pure-play vision care provider, highlighting ongoing governance tensions.