Ex-market darling Cochlear Limited (ASX: COH) hit a share price peak of $85 in early 2011. However, market worries over a product recall and profit downgrades saw it sold off heavily to trade for less than $60 today. This may present a long-term buying opportunity for savvy investors. Here's why.
1) It has direct operations in 20 countries and products sold in more than 100 countries, with a strong brand awareness amongst hearing practitioners globally. This provides a competitive advantage to deliver sustainable returns.
2) Cochlear has a well-earned reputation for innovation and research and development. An investment in Cochlear equates to backing it to deliver new products with game-changing future potential.
3) It's true that Cochlear is facing increased competitive pressures from the likes of Swiss business Sonova Holding AG (VTX: SOON), but it's also true that both operate in a relatively immature market with plenty of room for both to grow sales.
4) Cochlear's latest N6 Nucleus hearing aid device has recently been launched into the global market and this may bring a significant sales boost and take the fight to Sonova in winning market share.
5) Government and public healthcare spends on hearing aids for the profoundly deaf are likely to increase over time providing Cochlear with a strong natural tailwind.
6) Cochlear shares now offer a decent dividend yield of 4.3% at today's prices. However, if you're looking for a strong stock with an even better yield, look no further.
