Cochlear Ltd (ASX: COH) shares have had a shocker of a week after the massive earnings downgrade the company announced on Wednesday, raising the question, is it time to buy back in?
Shareholders wearing the pain
To put the scale of this week’s fall into raw numbers, the shares are down almost 45% to $92.91 on Friday, from levels close to $170 on Tuesday.
The shares have traded in a wide range over the past year, at one stage changing hands for $319.56, while they hit a 12-month low of $91.33 in recent days.
The enormity of this week’s share price rout is no great surprise when you look at what the company announced to the market.
The hearing implant maker said on Wednesday it now expected its underlying net profit to come in at $290-$300 million, down from a previous range of $435-$460 million.
The company went on to say:
Since January trading conditions for cochlear implants in developed markets have been softer than expected, with revenue flat for the quarter in constant currency. Near term surgical volumes have been affected by a combination of hospital capacity constraints and reduced referral activity from the hearing aid channel. Consumer sentiment has declined in key markets, reaching historic lows in the US. The decline appears to be affecting discretionary healthcare decisions in the adults and seniors segment, adding to demand uncertainty in the near term.
Cochlear said surgical volumes had been “constrained” in Western Europe, “resulting in growing waiting lists for surgery in markets including the UK and Germany, while industrial action in Italy and Spain has restricted surgical throughput”.
The US had been trading in line with expectations until mid-February, Cochlear said, with volumes then declining in March.
Shares look oversold
So what do the brokers think for Cochlear’s fortunes going forward?
I’ve had a look at recent research reports from the teams at Jarden and Macquarie, and while they both see upside from current levels, their price targets vary dramatically.
The Jarden team said Cochlear management had previously been targeting a net profit after tax margin of 18%, but they were now indicating it would take “a number of years” to recover to this level.
Jarden has reduced its expectations for earnings from the company out to FY28, but added that the shares were now looking cheap.
As the Jarden team said:
Cochlear’s share price reaction seems overdone but is also appropriate given Cochlear’s limited line of sight around earnings. Further, we continue to struggle to see how Cochlear is regaining lost share and expect further softness to continue into FY27 as the competition appears to be capturing share via price. We maintain our Neutral rating.
Despite their reservations around the company’s prospects, Jarden has a share price target of $169 on Cochlear shares, reduced from $224.
Macquarie has a much more conservative price target on Cochlear shares, while also having a neutral rating.
Macquarie’s 12-month price target is $115, with that having been reduced from $239.
Cochlear is currently valued at $6.51 billion.
The post How high could Cochlear shares bounce back? Brokers disagree appeared first on The Motley Fool Australia.
Should you invest $1,000 in Cochlear Limited right now?
Before you buy Cochlear Limited shares, consider this:
Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Cochlear Limited wasn’t one of them.
The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
And right now, Scott thinks there are 5 stocks that may be better buys…
* Returns as of 20 Feb 2026
.custom-cta-button p {
margin-bottom: 0 !important;
}
More reading
- 3 ASX 200 shares too cheap to ignore after sell-offs
- Could these ASX stocks really be set to double after crashing this week?
- 2 ASX 200 shares newly upgraded this week
- What is Morgans saying about Cochlear and Northern Star shares?
- 5 ASX 200 shares with renewed buy ratings this week
Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Cochlear and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Cochlear. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.