Trade of the Day: Set Your Sights on COO Stock

Advertisement

Cooper Companies Inc (COO) — COO stock hit a new year-to-date high above $173 on June 3, following the release of the health care company’s fiscal second-quarter earnings. Adjusted earnings increased 19% year over year to $2.05 per share, beating the Zacks consensus estimate by 13 cents. Revenues also came in ahead of estimates, rising 9% to $483.8 million.

But recent-profit taking looks like its providing traders with a good entry point in COO stock.

Following the better-than-expected earnings report, S&P Capital IQ Equity Research, which rates COO stock a “Buy,” raised its 12-month price target to $186 from $180. Its analysts also upped their full-year earnings guidance by 22 cents to $8.37 per share for fiscal 2016 (ending in October).

Capital IQ predicts revenue will grow 7.4% in fiscal 2016, bolstered by the integration of Sauflon Pharmaceuticals, which was acquired in 2014, and the expansion of the company’s silicon hydrogel soft contact lenses.

Turning to the chart, we see that following a low under $120 in January, COO stock ran until it hit the 200-day moving average in March. It briefly hesitated there, but that turned out to be only a minor stumble.

COO stock turned north again in April, consolidating in an ascending triangle pattern. Shares broke from the triangle in May at about $160 and set a new high for the year at $173.50 on June 3.

Since then, COO stock has succumbed to profit-taking, falling within a narrow channel. On Tuesday, and again on Thursday, it flashed minor (low-volume) buy signals from my proprietary indicator, the Collins-Bollinger Reversal (CBR). The next support is between its 50-day moving average at $159 and Thursday’s low near $161.

Traders should look to buy COO stock at $160 with a trading target of $180 for a potential gain of more than 12%.

COO Stock Chart
Click to Enlarge

Chart Key


Article printed from InvestorPlace Media, https://investorplace.com/2016/06/cooper-companies-inc-coo-stock-trade-day/.

©2024 InvestorPlace Media, LLC