Analyst Note| Debbie S. Wang |
Edwards posted a solid third-quarter performance that leaves the firm on track to meet our full-year projections. Our adjustments based on the latest quarter were minimal, but we may modestly raise our fair value estimate to reflect both time value of money as well as quarterly profitability that slightly exceeded our expectations. Nonetheless, Edwards did not raise its outlook, as many medical device makers have at this late stage in the year, which we think likely contributed to softening in the share price. We remain confident in Edwards’ narrow economic moat and see little to change our view of the firm’s ability to innovate and its expertise in structural heart.