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Edwards Lifesciences stock price target cut, neutral rating on Q3 financials

EditorNatashya Angelica
Published 25/10/2024, 16:20
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On Friday, Piper Sandler adjusted its price target for shares of Edwards Lifesciences (NYSE: NYSE:EW), reducing it to $70.00 from the previous $73.00, while keeping a Neutral rating on the stock.

The firm's analyst noted that Edwards Lifesciences announced its third-quarter results, which showed Transcatheter Aortic Valve Replacement (TAVR) and Transcatheter Mitral and Tricuspid Therapies (TMTT) performance slightly above Wall Street expectations. The company's third-quarter financials were reported excluding the Critical Care business, as the divestiture of this unit was completed last month.

According to the analyst, despite the challenges in comparing some of the third-quarter results due to the divestiture, the quarter appeared solid and slightly exceeded their expectations. The analyst pointed out that if there were any concerns from the update, it would be about the company's fourth-quarter guidance for TAVR and adjusted earnings per share, which are key figures investors use to project future performance.

The focus for Edwards Lifesciences is now shifting to the upcoming Transcatheter Cardiovascular Therapeutics (TCT) meeting scheduled next week. At this meeting, the company is expected to present several late-breaking data readouts.

The analyst suggested that the TCT could serve as a positive catalyst for the company's stock, but they remain cautious due to uncertainties surrounding the growth trajectory of the TAVR franchise.

The adjustment in the stock price target to $70.00 from $73.00 reflects this cautious stance, as analysts await more data to assess the potential impact on the company's financial outlook. The upcoming TCT meeting is anticipated to provide further insights that could influence investor sentiment and the future direction of Edwards Lifesciences' stock.

In other recent news, Edwards Lifesciences has been the focus of several analyst reports. Canaccord Genuity has reduced its price target for the company to $63 from $66, maintaining a hold rating. This adjustment follows Edwards Lifesciences' third-quarter financial report, which showed net sales of $1,354.4 million, marking a 9% year-over-year increase.

The company's Transcatheter Aortic Valve Replacement (TAVR) and Transcatheter Mitral and Tricuspid Therapies (TMTT) segments met expectations, with TAVR revenue reaching $1,023 million and TMTT revenue surging 73% to $91 million.

Truist Securities also lowered its price target for Edwards Lifesciences to $70 from $71 while maintaining a hold rating. This revision is due to expectations of a decrease in earnings per share (EPS) in 2025, reflecting the impact of the critical care sale and the dilution from acquisitions. BTIG maintained its neutral rating on the company, noting that Edwards Lifesciences' stock is fairly valued at its current level.

Edwards Lifesciences reported third-quarter earnings that exceeded analyst expectations, posting adjusted earnings per share of $0.67 and generating revenue of $1.35 billion, marking an 8.9% increase year over year.

The company anticipates revenue for the upcoming fourth quarter to be between $1.33 billion and $1.39 billion, with adjusted EPS expected to range from $0.53 to $0.57. These are some of the recent developments at Edwards Lifesciences.

InvestingPro Insights

To complement the analysis of Edwards Lifesciences (NYSE: EW), recent data from InvestingPro offers additional perspective on the company's financial position. As of the last twelve months ending Q2 2024, Edwards Lifesciences reported a robust revenue of $6.2 billion, with a notable revenue growth of 19.3%. This growth aligns with the analyst's observation of the company's solid performance in TAVR and TMTT segments.

InvestingPro Tips highlight that Edwards Lifesciences operates with a moderate level of debt and that its liquid assets exceed short-term obligations, suggesting a stable financial foundation. This financial stability could be crucial as the company navigates the uncertainties surrounding its TAVR franchise growth, as mentioned in the article.

The company's P/E ratio of 28.87 and its adjusted P/E ratio of 24.23 for the last twelve months indicate that investors are pricing in expectations for future growth. This valuation metric ties into the analyst's cautious stance and the adjusted price target, reflecting the market's current assessment of Edwards Lifesciences' prospects.

For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for Edwards Lifesciences, providing a deeper dive into the company's financial health and market position.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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