Markets

Will Flagship Impella Drive Abiomed's (ABMD) Q2 Earnings?

Abiomed 's ABMD second-quarter fiscal 2019 earnings are scheduled to release on Nov 1, before the market opens.

We believe the company is set to gain from its flagship Impella product line. However, competition in the industry is a headwind.

Fiscal Q1 Results at a Glance

In the first quarter of fiscal 2019, Abiomed posted adjusted earnings per share of 78 cents, which missed the Zacks Consensus Estimate of 80 cents. Adjusted earnings surged 73.3% from the year-ago quarter.

Revenues in the reported quarter came in at $180 million, beating the Zacks Consensus Estimate of $171.9 million. Revenues increased 35.9% from the prior-year quarter.

Abiomed has a positive average earnings surprise of 18.8% in the trailing three quarters.

Which Way Are Estimates Treading?

For the quarter to be reported, the Zacks Consensus Estimate for Abiomed's earnings per share is pegged at 73 cents, showing a year-over-year increase of 65.9%. The same for revenues stands at $175.3 million, reflecting an increase of 32% year over year.

ABIOMED, Inc. Price and EPS Surprise

ABIOMED, Inc. Price and EPS Surprise | ABIOMED, Inc. Quote

Let's see how things are shaping up prior to the earnings release.

Impella Likely to Drive Q2 Results

Abiomed's flagship product line, Impella has consistently driven the top line. For investors' notice, Impella is the world's smallest heart pump. It is a support system of percutaneous, catheter-based devices offering hemodynamic support to the heart.

In the last reported quarter, Impella contributed a significant 96.7% to Abiomed's net sales. U.S. Impella revenues rose 32% to $152 million on a year-over-year basis.

It is encouraging to note that Impella enjoys a strong global presence. In fact, the product contributed $2.6 million in revenues in Japan in the last reported quarter. Additionally, Abiomed opened eight new sites in Japan.

Moreover, the Impella 5.5 heart pump received CE mark approval in Europe earlier this year. (Read More: ABIOMED's Impella 5.5 Receives CE Mark in Europe )

Management expects to see continued demand for the Impella 5.0 and RP in the quarter to be reported.

Deterrent

The cardiac devices industry is intensely competitive.

Abiomed's products face stiff competition from organizations developing permanent heart assist products like Thoratec, Teleflex, HeartWare, Jarvik Heart and MicroMed Technology.

What Does Our Model Say?

Per our proven model, a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to deliver a positive earnings surprise in the quarter. However, this is not the case here.

Earnings ESP: Abiomed has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Zacks Rank: Abiomed carries a Zacks Rank #1.

Please note that we caution against stocks with a Zacks Rank #4 (Sell) or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revision.

Stocks Worth a Look

Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.

PerkinElmer PKI has an Earnings ESP of +1.45% and a Zacks Rank #3.

Becton, Dickinson and Company BDX has an Earnings ESP of +0.43% and a Zacks Rank #3. You can see the complete list of today's Zacks #1 Rank stocks here.

athenahealth ATHN has an Earnings ESP of +17.15% and a Zacks Rank #3.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>

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

athenahealth, Inc. (ATHN): Free Stock Analysis Report

PerkinElmer, Inc. (PKI): Free Stock Analysis Report

ABIOMED, Inc. (ABMD): Free Stock Analysis Report

Becton, Dickinson and Company (BDX): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

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.

In This Story

ABMD PKI BDX

Other Topics

Earnings Stocks

Latest Markets Videos

Zacks

Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

Learn More