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From Foster’s Home for Imaginary Friends. Coco is a sanity-challenged imaginary friend. Her only verbal utterances and written means of communication is “coco” (with each syllable pronounced “co”), which most of the imaginary friends, Mac, Frankie, and Madame Foster can understand.
When she is excited, scared, or needs the attention of others, she has the ability to lay plastic Easter eggs, similar to those found in arcades, that can contain anything from Ming vases to tickets for redemption of prizes to money or even auto parts.
On BLOGregard Q. Kazoo, the official blog for the show, Craig McCracken explains Coco’s design. 
"The idea behind Coco is that she was created by a lonely kid trapped on a desert island. Her design elements are made up of the kids thoughts/surroundings. Her tree head = the palm trees on the island, Her airplane body=the dream of being rescued and nightmare of how the kid ended up on the island, Her red beak=the deflated rubber raft that brought the kid to the island, Her shoeless sunburned feet=all the kid stares at all day, and her name Coco = Coconuts, what the kid lived on. As you can tell I think too much about this stuff."