Edwards Lifesciences (EW) Stock Upgraded at BMO Capital Markets

NEW YORK (TheStreet) -- BMO Capital Markets upgraded Edwards Lifesciences (EW) to "outperform" from "market perform" on Tuesday.

The analyst firm raised its price target for the medical devices company to $158 from $135.

BMO analysts raised their 2016 EPS estimates for the company to $4.65 a share from their previous estimates of $4.51 a share. The analyst firm also raised its 2017 EPS estimates for the company to $5.34 a share from its previous estimate of $5.12 a share.

"Since ACC, shares of EW have declined 11% versus the S&P 500 flat. We have a variety of theories on the reasons, and the stock has begun to recover," BMO analysts wrote. "Based on an analysis of relative P/E multiples, expense leverage, conversations with management, and our latest physician survey, we believe that shares of EW are positioned for another leg of ascent."

Separately, TheStreet Ratings team rates EDWARDS LIFESCIENCES CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate EDWARDS LIFESCIENCES CORP (EW) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity and solid stock price performance. We feel its strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Health Care Equipment & Supplies industry. The net income increased by 104.6% when compared to the same quarter one year prior, rising from $60.30 million to $123.40 million.
  • EW's revenue growth trails the industry average of 22.2%. Since the same quarter one year prior, revenues slightly increased by 9.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • EW's debt-to-equity ratio is very low at 0.27 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 4.23, which clearly demonstrates the ability to cover short-term cash needs.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, EDWARDS LIFESCIENCES CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Powered by its strong earnings growth of 100.00% and other important driving factors, this stock has surged by 63.51% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, EW should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • You can view the full analysis from the report here: EW Ratings Report

More from Markets

Replay: Jim Cramer on Tariffs, the Market Rally, Caterpillar and Micron

Replay: Jim Cramer on Tariffs, the Market Rally, Caterpillar and Micron

Video: When Planning for Retirement, Don't Underestimate Your Life Span

Video: When Planning for Retirement, Don't Underestimate Your Life Span

Video: Here's What May Come Next for Theranos Founder and CEO Elizabeth Holmes

Video: Here's What May Come Next for Theranos Founder and CEO Elizabeth Holmes

Charlie Gasparino Says GE Is Reportedly Looking to Slash Its Dividend Again

Charlie Gasparino Says GE Is Reportedly Looking to Slash Its Dividend Again

GE Confirms $11.1 Billion Transportation Merger With Wabtec

GE Confirms $11.1 Billion Transportation Merger With Wabtec