Cooper Cos. Is Falling on Earnings. Why Citi Downgraded the Stock.

The company, which makes CooperVision contact lenses, lowered its forecast for fiscal-year organic revenue growth. (Dreamstime)

Shares of Cooper Cos. were falling sharply Thursday after the medical device company reported disappointing quarterly revenue and caught a downgrade on Wall Street.

The company, which makes CooperVision contact lenses, posted adjusted earnings of $1.10 a share for its fiscal third quarter, ahead of the consensus estimate of $1.07 among analysts tracked by FactSet. Revenue grew 2% on an organic basis from the prior year—much lower than the expected 5.4% growth.

Management is forecasting 2% to 4% organic revenue growth in the fourth quarter, compared to the 7.1% rate analysts had anticipated prior to the report.

Cooper stock was falling 13% to $64.79 Thursday, putting it on pace for its lowest close since Oct. 24, 2022, according to Dow Jones Market Data. It was the second-worst performer in the S&P 500.

Following the earnings print, Joanne Wuensch of Citi Research downgraded the stock to Neutral from Buy and lowered her price target to $72 from $97, citing uncertainty about the company’s execution moving forward.

Citi lowered its revenue and earnings estimates for each fiscal year through 2028. “[Cooper] may look attractive to some at these levels, and it looks like it will take another step-down post-print,” but now isn’t the time to buy, Wuensch argued.

Write to Nate Wolf at nate.wolf@barrons.com