COH – Citi rates the stock as Sell

Cochlear has been found guilty of patent infringement by the LA District Court in the suite brought by Advanced Bionics. Cochlear will seek to overturn the verdict. Citi estimates, should the company be unsuccessful, that it will need to increase its borrowing facility to pay the damages bill, which could be as much as US$400m.

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COH – UBS rates the stock as Sell

Target $56.90 (was $59.50). More bad news for Cochlear, UBS reporting it looks like Advanced Bionics won the 1500 unit second tranche of the annual 4000 unit China tender. The broker admits COH may get lucky and pick up the third tranche, but there are only 1100 units left to go. This compares to the 2800 units supplied in FY13.

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COH – Citi rates the stock as Sell, Medium Risk

Citi analysts have put in the extra mile and gone through all data available regarding Adverse Event reports filed with the FDA regarding the Nucleus 5 implant. Their conclusion is that things could well be worse than indicated by Cochlear management as there appears to be an acceleration in failures. This, acknowledge the analysts, makes the voluntary recall the appropriate approach.

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COH – Deutsche Bank rates the stock as Upgrade to Hold from Sell

The broker has tweaked its earnings forecasts to reflect slowing sales and a cut back in spending but it still expects Cochlear to report strong FY11 sales and a big A$ hedging boost.
 
Weaker expectations are now largely in the price and with the stock having traded down towards the broker’s target, the broker has upgraded from Sell.

Sector: Health Care Equipment & Services.

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