Is Edwards’s TAVR Program Looking Better in 2023?

The TAVR pioneer was able to beat Wall Street estimates and perform better than it did for most of 2022.

Omar Ford

February 1, 2023

2 Min Read
Image by Tim Rue/Corbis via Getty Images

It would both be premature and a bit cliché to say that Edwards Lifesciences has gotten its groove back. But it would be accurate to say the transcatheter aortic valve replacement (TAVR) pioneer’s earnings are looking a lot better when compared to this time last year.

In its most recent reported earnings the Irvine, CA-based company beat Wall Street estimates. The company’s Q4 revenue was $1.35 billion, beating consensus of $1.3 billion by $15 million. But it wasn’t because of TAVR, said Marie Thibault an analyst with BTIG.

 “The revenue beat was the result of an outperformance in the Critical Care business as HemoSphere equipment sales increased and higher levels of respiratory-related hospitalizations led to greater demand for pressure monitoring,” Thibault wrote in research notes.

Edwards’s TAVR program faced tremendous headwinds. The company started out 2022 reporting weaker U.S. sales for its TAVR technology. The firm said those headwinds were centered around hospital capacity. The company said hospitals reached their limits in many cases and started deferring procedures.

Edwards said the hospital staffing shortages had a particularly heavy impact on TAVR procedures compared to other types of procedures because there is a lot more upfront work required before a patient even gets to the operating room. Patients are required to have a CT for sizing purposes prior to the procedure, and they often need an angiogram as well to screen for heart disease.

Edwards VP and CFO, Scott Ullem noted there were favorable signs that some of the headwinds were abating.  

“It's tough to isolate all the elements that are going into just the first couple of weeks of the year,” Ullem said, according to a Seeking Alpha transcript of the call. “But generally speaking, overall, it seems like the trends are favorable. And this is what we expected to happen in 2023 with hospital staffing constraints abating with overall disruptions in the healthcare system, getting a little bit better in the U.S. and outside of the U.S. And just the multiple different signals that we see and anecdotes that we hear give us confidence that we're on the right track.”

However, BTIG analysts approached the earnings – especially the news surrounding TAVR, with caution.

“…. After a string of weak TAVR results we remain on the sidelines awaiting evidence of this improvement in the TAVR market,” Thibault said. “We evaluate Edwards on both a P/E and EV/Sales basis and remain at Neutral based on the below-expectation TAVR results in recent quarters and Edwards still-premium multiple vs. peers.”

About the Author(s)

Omar Ford

Omar Ford is MD+DI's Editor-in-Chief. You can reach him at [email protected].


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