Coloplast Earnings: Underlying Demand Remains Strong, but Medicare Fraudsters Could Hurt U.S. Growth

Coloplast posted fiscal first-quarter results that featured robust organic revenue growth as well as ongoing margin pressure. On the whole, quarterly results largely met our expectations, and our minor model adjustments weren’t enough to materially shift our fair value estimate. Favorable market reaction to new intermittent catheter Luja as well as Kerecis fish skin underscores Coloplast’s intangible assets that support its wide economic moat. Though the shares have risen over the last three months, we think Coloplast remains modestly undervalued.