Barclays (LON:BARC) has adjusted its outlook on Edwards Lifesciences (NYSE: NYSE:EW), a prominent player in the medical device sector. The firm's analyst reduced the price target on the company's shares to $80 from the previous $90 but maintained an Overweight rating.
The adjustment reflects an anticipation of increased interest in Edwards Lifesciences as major clinical trial results are expected to be announced at the upcoming Transcatheter Cardiovascular Therapeutics (TCT) conference scheduled for October 27-31.
The analyst highlighted two significant clinical trials, EARLY TAVR and TRISCEND II 12-month results, which are set to be presented at the TCT. These results are believed to serve as potential catalysts for the company's stock. It is expected that at least one of these trials will yield positive outcomes that could favorably impact the stock's value.
In the interim, the company is projected to release its third-quarter results, which the analyst suggests will serve as a step toward resetting expectations for the company's 2024 earnings and operating results.
The forecast for continuing operations is in the range of $2.30 to $2.40 per share, excluding approximately 35 to 40 cents from Critical Care. This sets the stage for the 2025 earnings per share (EPS) to be in the range of $2.45 to $2.65, with Barclays' new 2025 EPS estimate set at $2.56.
Despite the lowered price target, Barclays remains positive on Edwards Lifesciences, citing the stock's attractive valuation at current levels.
However, the firm acknowledges the potential for increased volatility, driven by possible further downward revisions of Street estimates for 2025 and beyond, noting that consensus estimates for 2025 EPS currently stand at $2.81.
Barclays suggests that any weakness in Edwards Lifesciences' stock leading up to the TCT event could present a buying opportunity for investors. The firm anticipates a re-rating of the stock's value later in 2024, propelled by the company's annual December Investor Meeting and a clearer understanding of its intermediate and long-term growth goals.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.