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In a research note Monday, Piper Sandler analysts downgraded Edwards Lifesciences (NYSE:EW) to Neutral, lowering the firm’s price target on the stock to $80 from $95 per share.
They told investors that the decision to cut the stock was based on three factors, including the firm’s proprietary doc survey, Piper Sandler believing the U.S. TAVR market is becoming increasingly competitive, and the fact they see a less-than-ideal stock set-up behind what it views as lofty FY2023 guidance.
“The biggest disappointment from our survey was the respondents’ expected TAVR volume growth in the coming years. More specifically, our survey participants expect their aggregated volumes to grow +6.3% / +4.5% / +6.2% y/y, in 2023-2025, respectively,” explained the analysts.
In addition, the firm sees the U.S. TAVR market becoming more competitive. While Piper Sandler doesn’t expect market leadership to change any time soon, they believe the market “will become increasingly competitive in future years.”
“EW’s initial FY ’23 guidance came in better than expected, particularly on the top line, and given the recent challenges in the TAVR marketplace, we see Street numbers for ’23 as a touch lofty with not much opportunity for upside to materialize. We also believe 2023 represents a fairly “light” year from a catalyst standpoint,” the analysts concluded.
