2017 Promises To Be An Interesting Year For Edwards Lifesciences

Deutsche Bank reiterated its Hold rating on Edwards Lifesciences Corp (NYSE: EW), despite a fourth quarter beat, on overhangs related to competition and decelerating growth trends.

Edwards Lifesciences earned $0.75 a share for the quarter on revenue of $767.7 million, topping consensus estimate of $0.72/$759.5 million.

For the first quarter of 2017, Edwards sees adjusted EPS of $0.79-$0.89 and sales of $760 million to $800 million. Analysts expect earnings of $0.81 on revenue of $779 million.

In 2017, Edwards expects total company sales to range from $3-$3.4 billion. The company also expects underlying Transcatheter heart valves (THV) sales growth to decelerate to 15-20 percent, assuming some market share loss in U.S. and Europe.

Analyst Kristen Stewart hailed the management for bringing the breakthrough transcatheter aortic valve to market and creating shareholder value. But, the analyst is also concerned over the lack of clarity around timing and success with mitral despite saying 2017 is likely to be an interesting year for the company.

Stewart also pointed out political regulatory reimbursement issues over transcatheter aortic valves. She also quipped whether the company can maintain its high PE amid decelerating top line growth, emerging competition and pause of yet another transcatheter mitral program.

“While the longer term company fundamentals appear solid, the stock's risk/reward is less compelling to us,” Stewart wrote in a note.

As such, the analyst also cut her price target by $15 to $100.

Shares of Edwards Lifesciences plunged 9.3 percent to $88.89.