COH - Cochlear Limited

[robusta]

It's heading to 45 IMO. Looks to be in a corrective wave c after completing five waves and a wave a and b.

CSL also looks like it could be entering a prolonged down turn after completing a long term wave 5.

Well the share price is heading in the right direction.

This in the news yesterday from Advanced Bionics recall a few years ago.

http://www.businessweek.com/news/20...-dot-25-million-cochlear-verdict-zurich-mover

Will Cochlear have similar legal cases bought against them in the future?

 

[clinta44]

Will Cochlear have similar legal cases bought against them in the future?

If my memory is correct the patients affected by the COH recall only experienced hearing loss not any pain, overly loud sounds or any shocking sensations.

So I would think not... but you never know.

I'm keen for anything that will help drive the price down further!

 

[rbgmauq]

It's clear to me that COH is on its way up and I have to give props to the company. Very little resistance ahead until 66.81.

 

[coolcup]

When this stock first tanked following half year results, it experienced some brief support at ~$70. Following failure of this support level it dropped again finally finding stronger support at $60. It has since rebounded strongly but failed again at the $70 level. Looks to me as though it is heading for another test of $60 support. If that doesn't hold, the downside could be significant. Seems expensive too on a fundamental basis given the growth outlook is somewhat less "bankable".

 

[McLovin]

Getting pumped today.

For some comparison, this is from Sonova's FY result released late last month...

Cochlear implants segment: break-even target reached

Normalized for one-off costs*, the performance of the cochlear implants segment was another highlight in the year under review. Sales rose to CHF 146.7 million, an increase of 52.3% in Swiss francs or 47.1% in local currencies. The business benefited from a full year of sales of its HiRes 90K implant following approval from the US Food and Drug Administration (FDA) in September 2011. The cochlear implants segment returned a normalized EBITA* of CHF 1.8 million, breaking even for the first time. The company also presented significant innovations during the year, including a new processor and a new electrode design that will generate profitable growth beyond 2012/13.

Fair bit of divergence going on there. COH's main competitor is reporting. Given their sales results, they are logically stealing market from COH. It will be interesting to see how this plays out over the next couple of years but that PE ratio looks mighty ripe to get hacked at. They could end up having a couple of flat years as they cede market share to Sonova.

 

[skc]

Getting pumped today.

For some comparison, this is from Sonova's FY result released late last month...

Fair bit of divergence going on there. COH's main competitor is reporting. Given their sales results, they are logically stealing market from COH. It will be interesting to see how this plays out over the next couple of years but that PE ratio looks mighty ripe to get hacked at. They could end up having a couple of flat years as they cede market share to Sonova.

Opened a short on open. But I managed only 1/5 of the size I want...

The writing was on the wall for a little bit, esp since they missed out on that Chinese tender.

I guess this is the risk holders bear when the stock price requires sustained perfection...

 

[Knobby22]

Opened a short on open. But I managed only 1/5 of the size I want...

The writing was on the wall for a little bit, esp since they missed out on that Chinese tender.

I guess this is the risk holders bear when the stock price requires sustained perfection...

But they didn't miss out as far as I can discern skc
http://www.afr.com/p/world/cochlear_wins_slice_of_coming_chinese_kcIgVepNUxZZsSxuOJHfKL

Am I missing something?
Always wanted to own this company, particularly as the $A drops. Might be a good chance coming up.

PS a low cost alternative from China is being developed.
http://www.businessweek.com/articles/2013-03-28/a-chinese-hearing-implant-takes-aim-at-cochlear

 

[skc]

But they didn't miss out as far as I can discern skc
http://www.afr.com/p/world/cochlear_wins_slice_of_coming_chinese_kcIgVepNUxZZsSxuOJHfKL

Am I missing something?

Your news is 6 months old!

- Cochlear (COH $65.96) closed 0.8% lower after competitor Advanced Bionics announced that it has won the second tranche of the annual 4,000 unit Chinese cochlear implant tender. Advanced Bionics also received FDA approval for its new implant product.

From UBS on 30 May 2013.

 

[McCoy Pauley]

Your news is 6 months old!



From UBS on 30 May 2013.

I think there is a third, smaller tranche to come. According to UBS, there is a smaller tranche of 1100 units to be awarded by the Chinese.

Today's sell-off was driven largely, it appears, by fears that Cochlear's major market, being the US, is not being as lucrative as it once was. Growth of sales seemed to be slower than anticipated four months ago, when the half-year results were released. I also think there's been some delays in the release of the new model of the Nucleus implant. The decline in the AUD against the USD will not assist Cochlear this financial year. Given COH's pledge to keep the final dividend at $1.25/share as a minimum, by my rough, back of the envelope calculations, COH is likely to pay in excess of 100% of profits out as dividends this year (factoring in a $1.25/share interim dividend paid in the first half of the financial year).

Looking at a 10-year chart of COH, without professing to be any type of expert at technical analysis, I would say that the area between $43-$45/share is an important range for support. If COH goes beneath, say, $42.50/share, then I think the next major region of support would be down in the $20/share region.

 

[Bazmate]

Yeah, I reckon I wouldn't have been the only one looking at the $45ish level to pull the trigger.....

 

[robusta]

Yeah, I reckon I wouldn't have been the only one looking at the $45ish level to pull the trigger.....

Well I pulled the trigger a little early, averaged up at $56.23

 

[robusta]

It will be interesting to see how the new Nucleus 6 software goes against the competition. The company seems reasonably upbeat about the future time will tell if that optimism is justified.

 

[coolcup]

When this stock first tanked following half year results, it experienced some brief support at ~$70. Following failure of this support level it dropped again finally finding stronger support at $60. It has since rebounded strongly but failed again at the $70 level. Looks to me as though it is heading for another test of $60 support. If that doesn't hold, the downside could be significant. Seems expensive too on a fundamental basis given the growth outlook is somewhat less "bankable".

Looks like this call wasn't too bad. Stock was priced for perfection as already mentioned. Management's commentary today regarding "confidence in the future" really seemed a bit trite for me. An investment in this stock at current pricing is still a bit of blind faith in management credibility which has been sorely tested of late.

 

[tinhat]

Look for support around the $42-$45 level. Cochlear made a lower high in Jan 2013 compared to April 2011.

 

[McCoy Pauley]

As a long-term holder of COH, I'm very interested in the company's long-term performance. The Nucleus 6 technology appears to be again a market-leader, and I think the company's management justifies the slowdown in sales on the basis that the developed world markets are mature and those possible customers are holding off making a decision until the new implant is available. That could take up to another seven months according to the AFR this morning in the US (unless people are willing to cross the border into Canada). Missing out on the China tender would also hurt COH's growth prospects (at least in the short term) in the emerging markets.

I note that, following yesterday's news, Citi has downgraded COH with a 12 month price target of $42.50/share, with estimated EPS for FY13 coming in at 230.50cents/share. Their estimate for EPS is similar to what I've calculated based on yesterday's announcement. With the share price fall yesterday, I think the P/E ratio is now under 20x, which would (I hazard a guess) be the first time in quite some time (perhaps since the crash on the recall news) that the P/E ratio is under that multiple.

The AFR articles this morning make for some interesting reading. It seems that surgeons continue to acknowledge that COH has the best technology but they're badly lagging behind their competitors on the marketing and the "value-add" components of the sales pitch. Their competitors are providing, it seems, a lot more after-sales service than COH provides.

I suspect we'll see COH's share price base for the next two-three months until the financial reports are released in late August, and those reports could be the catalyst for a move up or a move down in the price.

A lot of speculation in my above post, so DYOR.

 

[McCoy Pauley]

Interesting - up almost 5% on the open this morning. Looks like some bargain hunters think the time is ripe to move in. I'd be interested to see the price action over the next few days and weeks, though.

 

[skc]

Interesting - up almost 5% on the open this morning. Looks like some bargain hunters think the time is ripe to move in. I'd be interested to see the price action over the next few days and weeks, though.

4 broker upgrades (mostly from sell to neutral) can do that. Closed my shorts on open today and gave back $2 a share.

 

[Gringotts Bank]

4 broker upgrades (mostly from sell to neutral) can do that. Closed my shorts on open today and gave back $2 a share.

Bring back the chick (the avatar, that is). It's time.

 

[skc]

Bring back the chick (the avatar, that is). It's time.

The chick as in a girl? Or the chick as in a fowl? I have used both.

 

[Gringotts Bank]

The chick as in a girl? Or the chick as in a fowl? I have used both.

Feathered variety.