Solid TMTT Growth to Drive Edwards Lifesciences' Q1 Earnings

Edwards Lifesciences Corp. EW is scheduled to report first-quarter 2025 results on April 23, after the market closes.

In the last reported quarter, the company’s adjusted earnings per share of 59 cents beat the Zacks Consensus Estimate by 7.27%. Its earnings beat estimates in two of the trailing four quarters and matched on the other two occasions, the average surprise being 2.60%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Q1 Estimates

The Zacks Consensus Estimate for the company’s first-quarter 2025 revenues is pegged at $1.40 billion, suggesting a 12.2% decline from the year-ago reported figure.

The Zacks Consensus Estimate for first-quarter 2025 net earnings of 60 cents per share indicates a 9.1% drop from the year-ago reported figure.

Factors at Play

In September 2024, Edwards completed the $4.2 billion valued sell-off of its Critical Care product group to Becton, Dickinson and Company or BD, enabling it to sharpen its focus on structural heart disease. Despite being strategic, the absence of this segment is expected to have affected the company's first-quarter 2025 revenues on a year-over-year basis, given that the division generated $251.3 million in sales in the first quarter of 2024. On top of that, broader macroeconomic trends might have weighed upon the quarter’s results, including inflationary pressure, supply chain constraints from geopolitical tensions and regulatory changes. Edwards’ business likely continues to experience staffing shortages within the hospital systems, which may have also hindered its operational results.

In the first quarter of 2025, the Transcatheter Aortic Valve Replacement (TAVR) arm is likely to have delivered a strong performance in the United States, thanks to its market-leading SAPIEN 3 Ultra RESILIA platform. The ongoing launch of SAPIEN 3 Ultra RESILIA in Europe is expected to have supported the international performance. The platform has demonstrated remarkable patient outcomes and the momentum is expected to have continued with more centers adopting it. We also expect steady sales in Japan in the first quarter, supported by the company’s efforts to address significant undertreatment of aortic stenosis among the country’s substantial elderly population.

During the February earnings call, Edwards stated that it experienced a few instances of regional pressure, despite holding a strong competitive position and stable global pricing. The trend is likely to have continued in the first quarter, restricting the segment’s full potential. Our model assumes TAVR sales to be $1.02 billion, reflecting a 1.6% year-over-year increase.

Edwards Lifesciences Corporation Price and EPS Surprise

Edwards Lifesciences Corporation price-eps-surprise | Edwards Lifesciences Corporation Quote

In the Transcatheter Mitral and Tricuspid Therapies (TMTT) segment, strength in the portfolio of repair and replacement technologies for both Mitral and Tricuspid valves is likely to have supported Edwards’ performance in first-quarter 2025. The PASCAL repair system is expected to have gained traction both in the United States and globally, thanks to its differentiated features, leading to increased adoption of the technology at both existing and new centers. Additionally, the commercial launch of the EVOQUE tricuspid replacement system may have continued to progress in the U.S. and Europe.

Edwards has guided $500 million in sales from this segment in 2025, and we expect it to have progressed meaningfully in the first quarter. Our model estimates the TMTT business to report revenues of $1.20 billion, implying a 64.6% improvement from the year-ago period.

Lastly, Edwards’ Surgical Structural Heart might have delivered a strong performance in the to-be-reported quarter, driven by global adoption of its premium RESILIA portfolio, including MITRIS, INSPIRIS and KONECT. The company likely saw positive procedural growth globally for the many patients best treated surgically, including complex and concomitant procedures.

Our model estimates the segment’s first-quarter revenues to be $251.4 million, suggesting a modest 0.9% rise from the year-ago quarter’s reported figure.

Earnings Whispers for Edwards

Per our proven model, stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), along with a positive Earnings ESP, have a higher chance of beating estimates, which is not the case here, as you can see below:

EW’s Earnings ESP: Edwards 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.

EW’s Zacks Rank: The company currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Top MedTech Picks

Here are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this time:

Masimo MASI has an Earnings ESP of +0.64% and a Zacks Rank #1. The company is expected to release first-quarter 2025 results soon. You can see the complete list of today’s Zacks #1 Rank stocks here.

MASI’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 14.41%. The Zacks Consensus Estimate for the company’s first-quarter EPS is expected to increase 61% from the year-ago quarter figure.

Veeva Systems VEEV has an Earnings ESP of +0.17% and a Zacks Rank #1. The company is expected to release first-quarter fiscal 2026 results soon.

The company’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 7.92%. The Zacks Consensus Estimate for VEEV’s fiscal first-quarter EPS is expected to surge 16% from the year-ago reported figure.

Hims & Hers Health HIMS has an Earnings ESP of +115.69% and a Zacks Rank #2. The company is slated to release first-quarter 2025 results on May 5.

HIMS’ earnings surpassed estimates in three of the trailing four quarters and missed on one occasion, the average surprise being 40.42%. The Zacks Consensus Estimate for Hims & Hers Health’s first-quarter EPS is expected to increase by 180% from the year-ago quarter figure.

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This article originally published on Zacks Investment Research (zacks.com).

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