Edwards Lifesciences Corporation EW reported fourth-quarter 2024 adjusted earnings per share (EPS) of 59 cents, which surpassed the Zacks Consensus Estimate by 7.3%. The figure increased 7.3% from the year-ago quarter’s level.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
The quarter’s one-time adjustments primarily include certain litigation expenses and amortization of intangible assets.
GAAP EPS from continuing operations was 58 cents compared with 55 cents in the fourth quarter of 2023.
Full-year adjusted EPS was $2.43, reflecting a 9.5% increase from the 2023 figure. The figure missed the Zacks Consensus Estimate by 5.1%.
In the third quarter, the company completed the sale of Critical Care, which has been recognized as a discontinued operation. EPS from discontinued operations for the quarter was 7 cents.
Following the earnings announcement, EW stock rose 5.4% at aftermarket trading yesterday.
EW’s Sales Details
In the fourth quarter, sales totaled $1.39 billion, up 9.4% year over year. The metric surpassed the Zacks Consensus Estimate by 2.2%.
Full-year sales totaled $5.44 billion, up 8.6% from the 2023 level. The figure missed the Zacks Consensus Estimate by 8.6%.
Segmental Details of EW
Global sales in the Transcatheter Aortic Valve Replacement (“TAVR”) product group amounted to $1.04 billion, up 5.8% year over year or 5.3% at CER. This compares with our model’s projection of $1.01 billion for the fourth quarter of 2024.
The company remains pleased with the performance of its SAPIEN 3 Ultra RESILIA, the leading platform in the United States and Europe. Additionally, Edwards Lifesciences' commitment to advancing clinical evidence and expanding patient indications was highlighted by results from the EARLY TAVR trial, the first and largest randomized controlled trial studying asymptomatic severe AS patients.
Transcatheter Mitral and Tricuspid Therapies (“TMTT”) sales totaled $105.1 million, up 87.7% from the prior-year figure on a reported basis (85% at CER). This compares with our model’s projection of $90.2 million for the fourth quarter of 2024.
This performance was driven by the PASCAL system and the continued introduction of EVOQUE system in the United States and Europe.
Surgical Structural Heart’s fourth-quarter sales totaled $244.4 million, up 5.8% from the year-ago level on a reported basis and 5.1% at CER. This compares with our model’s projection of $264.8 million for the fourth quarter of 2024.
This growth was driven by the strong global adoption of Edwards Lifesciences’ premium RESILIA portfolio, specifically the INSPIRIS, MITRIS and KONECT devices. The company continues to see positive procedure growth globally for patients best treated surgically, including those undergoing complex procedures.
Margins
The gross profit was $1.09 billion, up 7.7% year over year. The gross margin contracted 126 basis points (bps) to 78.9%.
The adjusted gross margin was 78.9% compared with 80.2% a year ago.
SG&A expenses rose 18.1% year over year to $491.9 million. R&D expenditures amounted to $271.1 million, up 12% year over year.
The operating income, however, decreased 7.3% year over year to $330.6 million. The operating margin contracted 431 bps to 23.9%.
Edwards Lifesciences Corporation Price, Consensus and EPS Surprise
Edwards Lifesciences Corporation price-consensus-eps-surprise-chart | Edwards Lifesciences Corporation Quote
EW’s Cash Position
Edwards Lifesciences exited the fourth quarter with cash and cash equivalents of $3.00 billion compared with $1.14 billion at the end of 2023. At the end of 2024, debt amounted to $600 million, in line with the previous year’s level.
Guidance
The company reiterated its 2025 guidance.
Edwards Lifesciences projects full-year 2025 constant currency sales growth of 8-10%. The Zacks Consensus Estimate for the metric is pegged at $5.81 billion. The company expects adjusted EPS to be in the range of $2.40-$2.50. The Zacks Consensus Estimate for the metric is pegged at $2.45 billion.
For the first quarter, the company expects EPS to be in the range of 58-64 cents. The Zacks Consensus Estimate for the metric is pegged at 59 cents.
The company expects first-quarter sales to be between $1.35 billion and $1.43 billion. The Zacks Consensus Estimate for the metric is pegged at $1.41 billion.
Our Take
Edwards Lifesciences exited the fourth quarter with better-than-expected results, with both earnings and revenues beating estimates. All the segments — TAVR, TMTT and Surgical — contributed significantly to the quarterly growth as more patients benefited from the company’s catheter-based structural heart therapies. However, the contraction of both margins during the quarter is discouraging.
The TMTT arm reported strong growth in both repair and replacement therapies for mitral and tricuspid patients. Edwards Lifesciences also announced favorable TRISCEND II trial data for its EVOQUE system. In Surgical Heart, Edwards Lifesciences continues to expand the RESILIA tissue technology evidence.
EW’s Zacks Rank and Key Picks
Edwards Lifesciences currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are Quest Diagnostics DGX, ResMed RMD and Cardinal Health CAH.
Quest Diagnostics reported fourth-quarter 2024 adjusted EPS of $2.23, which topped the Zacks Consensus Estimate by 1.8%. Revenues of $2.62 billion beat the Zacks Consensus Estimate by 1.9%.
DGX carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DGX has an earnings yield of 5.9% compared with the industry’s 4.1%. The company beat on earnings in each of the trailing four quarters, the average surprise being 3.8%.
ResMed, carrying a Zacks Rank #2 at present, posted second-quarter fiscal 2025 adjusted EPS of $2.43, which beat the Zacks Consensus Estimate by 5.6%. Revenues of $1.28 billion exceeded the Zacks Consensus Estimate by 1.6%.
RMD has an estimated fiscal 2025 earnings growth rate of 21.9% compared with the industry’s 13.2%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.
Cardinal Health, carrying a Zacks Rank #2 at present, posted second-quarter fiscal 2025 adjusted EPS of $1.93, which topped the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion exceeded the Zacks Consensus Estimate by 0.7%.
CAH has an estimated five-year earnings growth rate of 10.7% compared with the industry’s 9.3%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.
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