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The Cooper Companies (COO) is trading higher after JANA Partners called for an external search to replace CEO Al White, a new board chair and consideration of asset sales, intensifying pressure following the post-earnings selloff. The intervention comes after COO decided to retain CooperSurgical in a strategic review, with shares down 23% since August 31 and investors still weighing weak Q4 guidance against the potential for strategic change.

• The Board judged offers for CooperSurgical insufficient and chose to retain it, while saying it remains open to value creating alternatives. JANA is pressing for a broader examination that includes potential buyers for CooperVision. CooperSurgical grew 3% organically in Q3, led by 5% fertility growth.
• JANA Partners wants COO to search externally for a replacement for CEO Al White, appoint a new board chair and consider sales of CooperVision and CooperSurgical assets. Its demands are gaining traction after Q3 CooperVision revenue was flat despite mid-single-digit U.S. consumption growth and COO issued weak Q4 guidance, exposing a gap between underlying demand and reported results.
• Q3 revenue was $717 mln, roughly flat yr/yr, as U.S. channel destocking obscured mid-single-digit consumption growth. Management said Americas revenue would have grown about 5% without the inventory reduction, but also acknowledged difficulty converting contract wins into sales.
• Q4 guidance calls for non-GAAP EPS of $1.05-$1.09 and revenue of $1.057-$1.080 bln, with CooperVision organic sales forecast to decline 2% to remain flat.
• Shares are rising on the possibility that leadership or portfolio changes could unlock value, although any financial benefit depends on the Board’s response and improved sales execution.

Briefing.com Analyst Insight

JANA gives shareholders a potential route to leadership or portfolio change, but COO’s operating recovery still depends on completing the planned inventory reduction and improving sales execution. Management expects most destocking to end in Q4, setting up a test of whether reported CooperVision growth moves closer to underlying U.S. consumption in FY27. If that gap persists, a larger sales force could add expense before it delivers enough revenue to offset the higher tax rate. The next evidence will be CooperVision’s reported growth, the return on commercial spending and the Board’s response to JANA’s proposals