Azzet reports on three ASX stocks with notable trading updates today.
Cochlear seesaws on earnings miss and news of life-changing new product
Shares in Cochlear (ASX: COH) managed to rebound after dipping by as much as 9% at the open, with investors hitting the sell button following a downgrade to the company’s FY25 guidance.
However, as the market wore on it became evident that the market had over reacted to today’s update, with many investors seizing the early morning dip as a buying opportunity.
At this juncture the market was unaware that good news was yet to come.
What spooked that market today was a cut to the hearing implant giant’s FY25 underlying profit expectations.
Due to slower-than-expected sales growth over the last few months, management is now guiding to an underlying net profit of $390 million to $400 million compared to the originally expected lower end of $410 million to $430 million guidance.
Based on midpoint estimates, the downgrade is around 5%.
What made it difficult for the market to assess the significance of today’s update was the nature of its mixed bag result.
While the group expects a low double-digit decline in services revenue for FY25, the implants unit is still expected to increase by around 10%.
However, management took pains to advise the market that higher value developed markets have been impacted by slower-than-expected market growth and a small loss of market share within a handful of countries.
Meanwhile, the group expects a resurgence in services revenue in FY26, due in part to the introduction of its new of-the-ear Nucleus Kanso 3 Sound processor.
In a separate announcement today – seven minutes after the earnings downgrade - Cochlear unveiled the world's first smart cochlear implant system: the Nucleus Nexa System.
CEO Dig Howitt described the new Nucleus 8 Nexa Sound Processor - the result of 20 years of R&D - as the first Cochlear implant to run its own firmware.
The new Nucleus 8 Nexa Sound Processor is expected to give recipients access to a better hearing experience with both implant and sound processor updates.
“The Nucleus Nexa System builds upon Cochlear's industry-leading portfolio of electrodes, which are designed to optimise the electrode-neural interface and protect cochlea health and opens the door to even greater hearing potential for patients into the future,” said Howitt.
While the Nexa system will launch in Europe and Asia Pacific from mid-June, further market launches are planned pending regulatory approvals.
Cochlear has a market cap of $17.6 billion; its shares are down 16% in one year and up 1.1% in the last month.
The stock is currently up 0.01% today at $270.48.
Investor sentiment may be improving, with the weak trend in the 200-day moving average showing that sellers have been more aggressive than buyers for quite some time.
Consensus is Hold.
Cettire tanks on alarming sales drop off
Shares in Cettire (ASX: CTT) were down by around 30% heading into lunch following the global online retailer’s shock trading update that warned of a major miss to consensus earnings expectations.
Cettire, which sells discount luxury goods via its website, cettire.com delivered sales revenue for the 11 months ended 31 May of $693.8 million, up 1.7% over the previous period.
To put that result in context, during the first half of FY25, Cettire's sales revenue was up 11% to $394 million.
Sales growth of 1% in the third quarter does not bode well for the company’s fourth quarter outlook.
At 671,328, the company's active customers - who have purchased in the last 12 months - are down 3.5% since the end of March.
The company reported positive earnings of $12.1 million in the first half.
However, after factoring in a $2 million foreign exchange loss during April and May, earnings for the 11 months of FY25 were $0.5 million.
Given that its earnings were a negative $4.7 million during the third quarter, this suggests that Cettire has recorded a disappointing $6.9 million earnings loss for the first two months of the fourth quarter.
Commenting on today’s update, Cettire's CEO Dean Mintz told the market that management is focused on delivering improved profitability through the remainder of FY25 and into FY26, while the greater volatility in demand persists.
“The operating environment within the global personal luxury goods market since Cettire's Q3 FY25 trading update has remained volatile, with a continued softening of demand in the Company's established markets, notably in the US,” says Mintz.
With continued challenges in the sector amplified by trade uncertainty surrounding U.S. tariff policy, he said elevated promotional activity persists across the market.
Cettire’s cash of $45 million at the end of May compares with $76 million in March.
Given Cettire's dwindling working capital balance, brokers suspect future capital raisings are likely.
However, late April the company vigorously denied suggestions it would need to tap the market over the next six months in response to mounting fears of cash burn.
Meanwhile, it’s understood that over 5% of the company traded hands at a skinny discount on Tuesday morning.
Cettire has a market cap of $123 million; the share price is down 85% in one year and down 78% year to date.
The stock’s shares appear to be weak with little demand from investors.
Consensus is Hold.
Talaga Group jumps on Swedish mine update
Shares in Talaga Group (ASX: TLG) were up 12.5% at noon after the battery anode and advanced materials smallcap updated the market on a mine permit in Sweden.
With the Swedish government dismissing all remaining appeals, the company has secured full permitting for its Nunasvaara South graphite mine near Vittangi in the country’s north.
Today’s decision means Talga can move forward with its vertically integrated graphite supply chain, anchored by the mine and its Luleå anode refinery, which will produce 19,500 tonnes annually of lithium-ion battery anode material.
Given that the project underpins Europe’s battery supply ambitions, the company has received €70 million in EU funding.
In light of the project’s strategic significance it has also been listed under both EU’s the Critical Raw Materials Act and the Net-Zero Industry Act.
Talga’s CEO Martin Phillips believes these milestones showcase Talga’s commitment to responsible resource development.
“… the Swedish Government’s positive decision means we now have all major permits in place for both the mine and refinery,” he said.
Today’s update follows a successful $10 million fund raise by Talga last month.
Funds will be used to advance the Vittangi Anode Project pre-FID activities and for general working capital.
Talga Group has a market cap of $204 million; the share price is down 19% over one year and up around 6% in the last month.
Before today the stock’s shares appeared to be weak with little demand from investors.
Consensus is Strong Buy.
This article does not constitute financial or product advice. You should consider independent advice before making financial decisions.
