Edwards Lifesciences stock underperformed its peers on Friday, sliding on light sales of its transcatheter aortic heart-valve replacements.
Also called TAVR, the technology is a means of replacing a faulty aortic heart valve without resorting to open-heart surgery. Though total sales beat expectations, revenue from TAVR procedures came in short at $1 billion, William Blair analyst Margaret Kaczor Andrew said in a report.
"Management noted softer-than-expected growth in Europe due to aggressive competitor pricing led to trialing compared to the company's premium priced valves," she said. "While Europe is historically more price sensitive than the U.S., the company has been through similar scenarios before, and they have been manageable."
She noted U.S. TAVR growth came in above the company's global rate — a positive sign "in the patient funnel that has lagged a return since Covid."
Edwards Lifesciences stock fell 1.8%, closing at 85.29. That was below a nearly 1% jump for Investor's Business Daily's Medical-Products industry group.
Edwards Lifesciences Stock: Critical Care Outperforms
Across all segments, Edwards Lifesciences' sales jumped 10% to $1.6 billion, above forecasts for $1.57 billion, according to FactSet. Adjusted earnings popped 6.5% to 66 cents per share. Earnings beat calls by two pennies a share.
Beyond TAVR, sales of surgical heart-valve replacements grew 7% to $266 million and the critical care business brought in $251 million, up 13%. Sales within both segments beat Andrew's estimates by $8 million each. The 14.4% organic growth for Edwards' critical care business was the largest growth since 2021, she added.
Andrew kept her outperform rating on Edwards Lifesciences stock.
Edwards says it's "confident" in its TAVR guidance for the year. The company now calls for full-year sales to be at the high end of its previous outlook for $6.3 billion to $6.6 billion. TAVR sales are expected to climb 8% to 10%, excluding the impact of exchange rates.
The surgical segment is projected to tack on 6% to 8% growth, while critical care revenue is projected to climb 8% to 10%. Edwards is now planning to spin off the latter business. It's on track to wrap up that spinoff by end of the year, Edwards said in its news release.
Edwards Lifesciences stock remains below its 50-day line, MarketSurge shows.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
