The Cochlear Ltd (ASX: COH) share price is up from $156.09 in November to $194.26 today, despite the hearing aid manufacturer releasing no material news to the market since its announcement about an adverse court ruling in a patent infringement dispute.
It was the November 5 announcement that US$268 million in damages had been awarded against Cochlear by a U.S. district court that originally sent the shares lower. The damages award came about after a case was brought against Cochlear by U.S. hearing aid developers and researchers the Alfred E Mann Foundation and Advanced Bionics.
Even for a company Cochlear's size that posted a net profit of A$246 million in FY 2018 a US$268 million compensation bill is a huge amount and the market has likely shrugged off the news on the assumption that Cochlear will be able to get the verdict overturned in a court of appeal.
The legal dispute has been dragging on since 2014 and Cochlear has only provisioned A$21 million so far as a result of it.
It's forecasting a profit of $265 million to $275 million in FY 2019, up 8%-12% on the prior year, with it due to hand in its interim profit report this February.
