Dive Brief:
- Cooper Companies is receiving pressure from an activist investor to search for a new CEO, after the company lowered its earnings and revenue forecasts for 2026.
- Jana Partners last week called for Cooper to also evaluate the sale of its fertility and medical device assets, citing “chronic underperformance” following its latest earnings report. Jana also said the company should engage with buyers for its CooperVision segment. Cooper did not immediately respond to a request for comment.
- Cooper launched a strategic review in December that included considering a sale of CooperSurgical. Ultimately, the company decided that continued ownership was the best option, CEO Albert White said in an earnings call earlier this month.
Dive Insight:
Cooper makes contact lenses and other vision devices, IUDs, fertility products and surgical instruments. The company has faced challenges as revenue in its vision segment remained flat year over year, while Cooper prepared for a potential sale of its surgical segment. Ultimately, that plan didn’t pan out due to a “temporary disconnect between CooperSurgical’s intrinsic value and the offers received,” White said, leading to proposals that did not reflect the segment’s full potential.
Activist investor Jana has been building up a stake in Cooper since last year, Reuters reported. The investor called for action following the company’s third quarter earnings report, citing concerns with Cooper’s forecasting, managing of expectations and poor capital allocation.
“Slashing CooperVision segment growth due to ‚inflated‘ channel inventory, coming up empty on a long, drawn-out strategic review for the CooperSurgical segment that the CEO repeatedly hyped along the way and aggressively repurchasing stock ahead of both negative outcomes is a masterclass in how not to operate and oversee a company,” Jana said in its statement.
Jana called for an immediate external search for a new CEO and a new board chair. The activist also called for revised compensation metrics to improve accountability, and for the company to engage a performance improvement consultant.
Finally, Jana said Cooper should evaluate the sale of its assets from its surgical business, as the review evidenced buyer interest, and engage with potential strategic buyers for its vision business.
