Cochlear Ltd (ASX: COH) is one the most popular growth shares on the S&P/ ASX200 (ASX: XJO), but its strong long-term outlook is no secret and nearly always reflected by a high valuation.
On August 16 the expert analysts at Goldman Sachs took another look at Cochlear after it handed in a full year profit of $265.9 million on revenue of $1,446.1 million for the financial year ending June 30, 2019.
The Goldman's analysts suggested FY 2019 was generally disappointing for Cochlear as rivals stole market share, but noted attention should now focus on FY 2020 with Cochlear's management serving up "bullish" commentary.
"There was much positivity around the early uptake of the new implant Nucleus Profile Plus (although we would expect this from the company at this stage). The product is selling into the US and several key European markets today and it expects the majority of the roll-out to complete by end-1H20, which could be modestly ahead of expectations," the analysts wrote.
Overall though Goldman's is sticking to a "neutral" rating on the shares given they are already marginally ahead of its $211 share price target.
I'd have to agree with Goldman's on this one in that Cochlear is a high-quality company but that looks fully reflected in the price even with it forecasting profit growth between 9%-13% in FY 2020.
It's still my view that both CSL Limited (ASX: CSL) and ResMed Inc. (ASX: RMD) look better bets on valuations grounds.
