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Here's What's Pumping Up Shares of Edwards Lifesciences Corp. Today

Stylized stock chart with a series of dollar signs sloping upwards

What happened

Shares of Edwards Lifesciences Corp. (NYSE: EW) , a medical-device company focused on heart disease, reported impressive growth across the board after the market closed yesterday. The market is so impressed, it's driven the stock up 9% as of 11:28 a.m. EDT on Wednesday.

So what

On a GAAP basis, first-quarter sales rose 24% higher than the prior-year period to $884 million, and earnings jumped 61% to $1.06 per share. Adjusting for the cautious overstocking of heart valves in Germany, and other factors, brings year-on-year sales and earnings-per-share growth for the quarter down to 19% and 32% respectively.

Stylized stock chart with a series of dollar signs sloping upwards

Image source: Getty Images.

Over the past couple years, Edwards Lifesciences stock has bounced around as investors have become increasingly concerned about its ability to contend with Medtronic (NYSE: MDT). The medical-device industry's 900-pound gorilla is a major player in the valve replacement space, but today's earnings report suggests a slimmed-down Edwards Lifesciences can dance around the behemoth without getting squashed. First-quarter sales of transcatheter heart valve therapies, the company's bread and butter, surged 46.6% higher year on year to $539.2 million.

Now what

After such a strong start to 2017, Edwards Lifesciences raised its full-year earnings outlook a few notches higher. Instead of a range of $3.30 to $3.45 per share, the company now expects adjusted earnings this year to land between $3.43 and $3.55 per share.

Before investors get used to the company's recent growth spurt, it's important to realize its valve-replacement advantage over Medtronic might not last much longer. Last summer Edwards Lifesciences' Sapien 3 valves became the first to earn approval from the U.S. Food and Drug Administration for use in patients deemed at intermediate risk of not surviving the standard open-heart valve replacement surgery.

The agency's decision made the Sapien 3 the only replacement valve available for patients seen as having a 3% to 15% chance of not surviving open-heart surgery. Last month, Medtronic announced results from a successful clinical trial that will probably result in its own replacement valves entering the same space. Investors will want to keep their eyes peeled for signs the Sapien 3 valves can continue landing punches with the industry's fiercest competitor in the ring.

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Cory Renauer owns shares of Medtronic. The Motley Fool owns shares of Medtronic. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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