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Edwards Lifesciences Raised to Buy

Zacks Equity Research

On April 16, Zacks Investment Research upgraded Edwards Lifesciences Corp. (EW) to a Zacks Rank #2 (Buy).

Why the Upgrade?

Over the past 7 days, Edwards Lifesciences has been witnessing rising estimate revisions for 2014 characterized by two upward revisions against no downward movement. The positive revisions drove a 1.3% rise in the Zacks Consensus Estimate to $3.04 per share over the same time frame.

Moreover, over the last 30 days, the company has been witnessing rising estimate revisions for 2014 sans any downward movement. Notably, Edwards Lifesciences has estimated long-term growth of 15.4%, above the expected industry average growth rate of 14.8%. This indicates healthy prospects over the long haul.

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Over the last one week, Edwards Lifesciences’ estimates were on the rise mainly on the back of the verdict of the U.S. District Court for the District of Delaware, which granted the company a preliminary injunction blocking sales of Medtronic, Inc.’s (MDT) CoreValve in the U.S. Post-announcement of the news, shares of Edwards Lifesciences went up 11.0%, clearly reflecting positive investor sentiment.

Edwards Lifesciences had been a formidable player in the transcatheter aortic heart valve market in the U.S. since the launch of SAPIEN in 2011. However, Medtronic’s comparable offering – CoreValve - was granted U.S. Food and Drug Administration (:FDA) approval in Jan 2014.

Now, with the favorable court ruling and next-generation transcatheter valve SAPIEN XT in the company’s pipeline, Edward Lifesciences is well positioned to continue dominating and strengthening its foothold in the U.S. transcatheter aortic heart valve market. Moreover, as per ResearchAndMarkets, the U.S. is expected to dominate the global transcatheter heart valve market by 2017 and should account for an estimated 61% of worldwide transcatheter aortic heart valve revenues.

Edwards Lifesciences has been in the news this year for all the right reasons. The company kick-started the year with the receipt of CE mark approval for SAPIEN 3 in January and SAPIEN XT in February followed by the INTUITY Elite Valve System in April.

Other Stocks to Consider

Some better-ranked stocks in the broader healthcare sector are Enzymotec Ltd. (ENZY) and Myriad Genetics Inc. (MYGN). Both stocks sport a Zacks Rank #1 (Strong Buy).

Read the Full Research Report on EW
Read the Full Research Report on ENZY
Read the Full Research Report on MDT
Read the Full Research Report on MYGN


Zacks Investment Research