Follow Edwards Lifesciences to never miss an important update.
Leerink Partners raised its rating on the company to outperform, which is their way of saying they expect the stock to do better than the rest of the market. The move came after the company reported better-than-expected results for the second quarter.
Analysts are gaining confidence that the core business of replacing aortic valves without surgery is stabilizing. While this market is maturing, the company is managing to grow it at about 10 percent while also launching new products for other heart valves. This suggests the company can maintain its lead even as competition increases.
Source: Leerink Partners
The company reported second-quarter revenue of 1.74 billion dollars, which was higher than the 1.70 billion dollars analysts expected. Earnings per share also came in ahead of targets at 0.78 dollars. The stock rose about 7 percent following the news as the company raised its sales growth forecast for the full year to between 10 and 11 percent.
This is an important result because it shows the core business, which replaces heart valves using a tube instead of open-heart surgery, is still growing at a double-digit pace. Investors have been worried that this market was slowing down, but a 10.5 percent growth rate in that unit suggests there is still plenty of demand. Meanwhile, the newer business focused on repairing different types of heart valves brought in nearly 196 million dollars, showing the company is successfully building a second engine for growth.
See the full quarter, and how our tracked metrics did
Source: 8-K filing
Management has a long history of setting conservative targets and clearing them by a few cents. This steady execution suggests their forecasts are reliable and they have a firm grip on the business.
| Expectation | |
|---|---|
| EPS | $0.73 |
| Revenue | $1.68B |
Follow Edwards Lifesciences to get the latest and most important updates.
Follow EW