Should Edwards Lifesciences Stock Remain in Your Portfolio Now?
May 16, 2025
Edwards Lifesciences
’ EW first-quarter 2025 performance was backed by its most comprehensive structural heart disease portfolio. In the TTMT (Transcatheter Mitral and Tricuspid Therapies) segment, the increasing global uptake of the PASCAL and EVOQUE systems is highly encouraging. Meanwhile, a volatile macro economy and adverse currency impacts may dent Edwards’ growth.
In the past year, this Zacks Rank #3 (Hold) company’s shares have lost 14.6% compared with the industry’s 14.9% decline. The S&P 500 composite has increased 11.2% in the same time period.
The renowned global medical device company has a market capitalization of $44.63 billion. EW’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 2.60%.
Let’s delve deeper.
Upsides for EW
Surgical Structural Heart, a Promising Business
: The business pioneered the innovative RESILIA tissue, which is backed by more than 40 years of the company’s tissue technology leadership.
In the first quarter of 2025, the segment grew 1% from the prior-year level, driven by strong global adoption of Edwards’ premium surgical technologies, INSPIRIS, MITRIS and KONECT. The company continues to see positive procedure growth globally for the many patients treated surgically, including those undergoing complex procedures.
Edwards has been continuously generating evidence to expand the RESILIA portfolio. In line with this, the company shared eight-year data during the first quarter, demonstrating the durability of the RESILIA tissue bioprosthetic valves at the Heart Valve Society meeting. Additionally, the pivotal trial for the J-Valve AR system has been initiated.
In the first quarter, the company made progress in advancing important innovations worldwide, including the launch of MITRIS in China, which received positive feedback from surgeons.
TMTT Portfolio Holds Potential
: The company constructed a strategic portfolio of leading transcatheter technologies to provide repair and replacement solutions for mitral and tricuspid patients, backed by the insights gained from clinical trials and real-world experiences.
In the first quarter, the segment witnessed a 58% increase in sales compared to the prior year, driven by the PASCAL system and the continued introduction of the EVOQUE system in the United States, Europe and globally.
Meanwhile, Edwards Lifesciences is making strides with the EVOQUE commercial rollout, having successfully activated new sites in both the United States and Europe (excluding initial trial centers). Also, under the finalized NCD, EVOQUE became eligible for all Medicare beneficiaries for the treatment of symptomatic tricuspid regurgitation (TR) in March.
Image Source: Zacks Investment Research
In April, Edwards’ SAPIEN M3 mitral valve replacement system received CE Mark for the transcatheter treatment of patients with symptomatic mitral regurgitation (MR) who are unsuitable for surgery or transcatheter edge-to-edge (TEER) therapy.
Concerns for EW
Macro Concerns Weigh on the Bottom Line
: The global economy continues to experience volatility and disruptions, including inflation and factors that influence overall economic stability, as well as the political environment related to healthcare. Additionally, any significant increase in the cost of raw materials and supply constraints stemming from geopolitical complications, regulatory changes, or other factors could weigh heavily on the company’s operating results.
In the first quarter of 2025, the company experienced an 8.7% rise in SG&A expenses compared to the prior-year levels.
Foreign Exchange Headwinds
: Foreign exchange is a major headwind for Edwards Lifesciences due to a considerable percentage of its revenues coming from outside the United States. Edward Lifesciences is likely to face significant challenges owing to the unfavorable foreign currency impact that has been adversely impacting the company’s gross margin over the past few quarters. Foreign exchange rates decreased the first-quarter reported sales growth rate by 170 basis points (year over year).
EW’s Estimate Trend
The Zacks Consensus Estimate for 2025 earnings per share (EPS) has moved north 0.4% to $2.46 in the past 30 days.
The Zacks Consensus Estimate for 2025 revenues is pegged at $5.89 billion, implying a 1.3% decline from the year-ago reported number.
Top MedTech Picks
Some better-ranked stocks in the broader medical space are
Phibro Animal Health
PAHC,
STERIS
STE and
Cardinal Health
CAH.
Phibro Animal Health has an estimated long-term earnings growth rate of 26.2% compared with the industry’s 15.9%. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 30.6%. Its shares have surged 34.5% compared with the industry’s 8.9% growth in the past year.
PAHC carries a Zacks Rank #2 (Buy) at present. You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
STERIS, carrying a Zacks Rank #2 at present, has an earnings yield of 4.3% compared with the industry’s -2.7%. Shares of the company have rallied 40% compared with the industry’s 8.9% growth. STE’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 0.6%.
Cardinal Health, carrying a Zacks Rank #2 at present, has an estimated earnings growth rate of 11.8% for fiscal 2026 compared with the industry’s 9.8%. Shares of the company have rallied 52.6% against the industry’s 4.1% decline. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 10.3%.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
