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Highlight

  • Cochlear received a 1-BUY rating from Jefferies analyst David Stanton on 12 June 2025.

  • The target price of AUD 311.00 implies a 14.21% upside from the current price.

  • Shares have rebounded after an initial dip on Thursady, showing investor optimism around the new Nucleus Nexa System.

  • Cochlear downgraded its FY25 earnings forecast due to weak Services revenue but expects 10% growth in cochlear implant units.

Cochlear Ltd (ASX:COH), a global leader in hearing implants, has garnered positive sentiment from analysts even as it revised its financial guidance downward for FY25. The latest endorsement came from Jefferies analyst David Stanton, who issued a BUY rating on 12 June 2025.

Stanton assigned a target price of AUD 311.00, representing a potential 14.21% increase from the current market price of approximately AUD 272.31. This optimistic outlook comes on the back of the launch of Cochlear's new Nucleus Nexa System, a next-generation cochlear implant system with world-first features, including upgradeable firmware.

While the market initially reacted negatively to Cochlear's revised FY25 earnings forecast—sending the stock down by almost 9%—investors appear to have quickly reassessed the company's growth trajectory. As of early trading on Thursday, the stock had recovered to around AUD 271.

The Nucleus Nexa System, a significant technological breakthrough, offers users a smaller, lighter sound processor with extended battery life and embedded memory. This system allows users to save personal hearing profiles directly onto the implant, enabling seamless transitions between compatible devices and reducing the need for clinic visits. According to CEO Dig Howitt, the product is the result of a 20-year investment in R&D and is designed to further optimise hearing outcomes and cochlear health.

Despite this innovation, Cochlear revised its underlying net profit forecast to AUD 390–400 million, down from earlier estimates. The primary drag was attributed to declining Services revenue, now expected to fall in the low double digits, versus the previously projected single-digit decline. The company, however, maintained that cochlear implant unit sales are expected to rise by approximately 10%, bolstered by demand in emerging markets.

Analyst sentiment remains cautiously optimistic. The average recommendation across firms currently stands at 2.63 (Hold), with an average target price of AUD 289.02, indicating a 6.14% upside. While UBS has withheld a specific rating or target, Sacha Krien of E&P maintains a 2-POSITIVE rating, forecasting a target of AUD 331.34, implying a more aggressive 21.68% upside.

Looking forward, investors are eyeing Cochlear’s full-year results scheduled for 15 August 2025.