For Immediate Release
Chicago, IL - February 3, 2012 - Zacks.com announces the list of
stocks featured in the Analyst Blog. Every day the Zacks Equity
Research analysts discuss the latest news and events impacting
stocks and the financial markets. Stocks recently featured in the
blog include
Medtronic
(
MDT
),
Edwards Lifesciences
(
EW
),
Boston Scientific
(
BSX
),
St Jude Medical
(
STJ
) and
Southwest Airlines Co.
(
LUV
).
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Here are highlights from Thursday's Analyst
Blog:
Positive Outcome on Medtronic's CoreValve
Leading medical device player
Medtronic
(
MDT
) recently came out with the results of two studies conducted on
the company's CoreValve System delivered through the direct aortic
implantation approach. The data demonstrated at the 48
th
Annual Meeting of the Society of Thoracic Surgeons (
STS
) showed positive result from this kind of implantation.
Earlier, in November 2011, CoreValve System with direct aortic
implantation approach got the CE (Conformité Européenne) Mark
approval. This direct aortic approach has also been assessed in the
CoreValve US Pivotal Trial of Medtronic.
Data in this regard showed procedural success in 92 of 93
patients treated at 12 centers across Europe. The overall 30-day
mortality rate stood at 9.7%. Among the patients, 83.9% were
initially detected with peripheral vascular disease and almost
one-third underwent previous coronary artery bypass surgery
(indicating significant preoperative risk of mortality with
standard surgery).
A separate study in Italy also illustrated positive outcome of
implantation of the CoreValve System through the direct aortic
approach. The data of 25 patients demonstrated 92% (23 of 25
patients) survival rate at 30 days. None of the patients
experienced strokes and 4 patients were implanted with pacemakers
post-procedurally. All of these patients had previously diagnosed
peripheral vascular disease.
The CoreValve System is designed to replace diseased aortic
valves without undergoing an open-heart surgery. Globally,
approximately 300,000 people have been diagnosed with this
condition and roughly one-third of these patients are deemed at too
high a risk for open-heart surgery. This system is available in
three sizes (26mm, 29mm and 31mm), and is the only transcatheter
aortic valve implantation (TAVI) system approved for direct aortic
implantation.
Although CoreValve is already approved in Europe since 2007,
Medtronic is working on getting the US approval for the device.
Earlier this month, the company completed the enrollment in the
extreme risk category of patients for its CoreValve US Pivotal
Trial.
During the most recent quarter, the company experienced robust
growth in the Structural Heart portfolio, driven by strong adoption
of CoreValve in the international markets. The company is
witnessing strong early adoption of the 31mm CoreValve that
received CE Mark approval in July and anticipates CE Mark approval
for the 23 mm CoreValve in the second half of fiscal 2012.
Recommendation
We are impressed with Medtronic's continuous efforts to achieve
the US approval for CoreValve and expect its further contribution
in the international business as well. A pivotal trial for
CoreValve began in Japan earlier in November.
In October, CoreValve received approval in Korea and the company
is further working to get the device approved in several countries
including the US, Thailand, Singapore, China, Hong Kong and Taiwan.
However,
Edwards Lifesciences
(
EW
) has the first mover advantage in US with FDA approval of Sapien
clinched in November last year.
Medtronic reported weaker sales from its two largest segments -
defibrillators and spinal implants. The challenges witnessed in the
US ICD market have also been felt across the board and impacted
Medtronic's competitors,
Boston Scientific
(
BSX
) and
St Jude Medical
(
STJ
).
To overcome these challenges, Medtronic is leaving no stones
unturned to revive growth. This includes penetration of
international markets, portfolio expansion, focus on high-potential
segments and restructuring initiatives. These should benefit the
company over the long term.
Medtronic currently retains a Zacks #3 Rank (short-term Hold
rating). We also maintain our long-term Neutral recommendation on
the stock.
Earnings Scorecard: LUV
The largest U.S. low-cost carrier
Southwest Airlines Co.
(
LUV
) saw the thirty ninth year of profit in fiscal 2011, as announced
on January 19, amid rising fuel prices and economic
uncertainties.
Fourth Quarter & Fiscal 2011 Review
Southwest Airlines reported fourth quarter adjusted earnings of
9 cents per share beating the Zacks Consensus Estimate by a couple
of cents. The quarter's earnings, however, dropped 40% from the
year-ago quarter. For fiscal 2011, adjusted earnings declined 41.9%
year over year.
Total revenue improved substantially both in the fourth quarter
and fiscal 2011. Continued growth in the All-New Rapid Rewards
program, EarlyBird check-in, unaccompanied minor travel and pet
fees led to the healthy performance. Airlines traffic showed an
impressive growth with strong increases in capacity.
Escalating fuel prices took operating expenses higher for the
last year. Unit cost (cost per available seat mile) excluding fuel
and special items, dipped slightly in the fourth quarter while
remained stable for the full year.
(Read our full coverage on this earnings report:
Southwest Beats on Strong Top Line
)
Guidance
For the first quarter of 2012, management expects passenger
revenue to continue to improve and unit costs to increase compared
to the year-ago quarter. Fuel costs, including fuel taxes are
estimated at approximately $3.35 per gallon.
Further, Southwest expects to exit fiscal 2012 with a fleet of
691 aircraft and projects capital expenditure of $1.3 billion.
Agreement of Analysts
Following the fourth quarter earnings release, the analysts are
skewed toward the negative side in estimate revisions for the
upcoming quarter. Out of 10 analysts, 3 revised their estimates
downward over the last 30 days while none made a positive revision.
None of the analysts moved in either direction over the last 7
days.
The movements of estimates for the next two fiscal years were on
the positive side. For fiscal 2012, 5 analysts out of 14 made
upward revisions over the last 30 days while 3 moved downward. Only
1 analyst out of 8 raised the estimate over the last 30 days for
fiscal 2013 while none moved in the opposite direction.
None of the analysts moved in either direction over the last 7
days for the two fiscal years.
Although Southwest is poised to benefit from fleet rightsizing,
Evolve retrofit program, steady capacity growth and several
ancillary revenues, the analysts are mainly concerned with high
maintenance and operating costs associated with fleet rightsizing
and modernization.
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BOSTON SCIENTIF (
BSX
): Free Stock Analysis Report
EDWARDS LIFESCI (
EW
): Free Stock Analysis Report
SOUTHWEST AIR (
LUV
): Free Stock Analysis Report
MEDTRONIC (
MDT
): Free Stock Analysis Report
ST JUDE MEDICAL (STJ): Free Stock Analysis
Report
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