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Boston Scientific Stock Hits 10-Year High After Q1 Beats Estimates

Medical device maker Boston Scientific ( BSX ) popped to a 10-year high Wednesday after it reported a strong Q1 and raised its guidance. Boston Scientific’s adjusted earnings totaled 28 cents in the quarter, up 33% from the year-earlier quarter and beating analysts’ consensus by four cents, according to Thomson Reuters. Revenue rose 11% to $1.96 billion, beating consensus by about $50 million. Boston Scientific added more than $100 million to its full-year revenue guidance range, now $8.08 billion to $8.23 billion, up 9% at the midpoint vs. $7.48 billion last year. It also added two cents to its full-year EPS guidance, now 64 to 69 cents. The company said that its sales in the current quarter should be $2.01 billion to $2.06 billion, up 10.6% at the midpoint from $1.84 billion a year ago and on the high side of consensus. Its earnings guidance of 25 to 27 cents a share was in line with Wall Street’s estimate and up from 21 cents last year. Boston Scientific stock was up 9.5% in morning trading on the stock market today , near 21.50 and hitting its highest point since May 2006. In a research note Wednesday, RBC Capital Markets analyst Glenn Novarro broke down the results. “Cardiovascular revenues of $790 million (+13% year-over-year constant currency) easily topped our estimates and consensus,” he wrote. “We believe cardiovascular results were led by share gains for Synergy (drug-eluting stent) in the U.S., robust adoption of Watchman (left atrial appendage closure device) and strong peripherals sales. “Meanwhile, MedSurg sales of $682 million (+28% year-over-year constant currency, +11% year-over-year organic) also topped expectations, driven by strong Endoscopy results, owing to Spyglass DS (direct visualization system) and the launch of the Axios stent system, and Urology/Women’s Health.” On the downside, Novarro said that cardiac rhythm management sales were light, which he says is due to Medtronic ( MDT ) taking share in the implantable cardioverter defibrillator market. However, Evercore ISI analyst Vijay Kumar wrote that Monday’s approval of a new MRI-safe suite of pacing products should help boost the division. Boston Scientific’s growth has been picking up the last three quarters, helping drive the stock to a strong IBD Composite Rating of 94.

Intuitive Surgical Q1 Impresses Wall Street, As Stock Hits New High

Surgical-robot maker Intuitive Surgical ( ISRG ) received multiple price target hikes from Wall Street, as its stock hit a new high Wednesday, following its Q1 earnings report late Tuesday. As IBD reported, Intuitive Surgical’s Q1 earnings beat estimates , but what really interested analysts was the quarter’s 17% procedure growth. Intuitive Surgical normally sells only about 100 of its pricey da Vinci robotic systems per quarter, so surgical procedures using the company’s consumable accessories and services are key to steady revenue. Management raised procedure-growth guidance for the year to 12% to 14%, from the previous 9% to 12%. Operating expenses increased, and Intuitive Surgical’s management also raised its opex guidance for the year to 12% to 15% of revenue, up from 9% to 13% previously. However, it likewise raised its gross-margin guidance to 69% to 70%, from 68% to 69.5%. Intuitive Surgical is on IBD’s Big Cap 20. Who else makes the grade? “Intuitive Surgical’s impressive Q1 procedure growth is consistent with our recent positive general surgeon checks,” wrote RBC Capital Markets analyst Brandon Henry as he raised his price target to 640 from 610 while maintaining a sector perform rating. “While Intuitive Surgical is accelerating operating expense spend, we believe these investments should drive increased future robotics adoption and help the company maintain its superior position in the robotics market, despite upcoming competition.” The company has no competitors at present, but Medtronic ( MDT ), TransEnterix ( TRXC ) and Johnson & Johnson ( JNJ ) partnering with Alphabet ‘s ( GOOGL ) Verily division are all developing their own robotic surgery systems. Leerink analyst Richard Newitter lifted his Intuitive Surgical price target to 710 from 700 while maintaining an outperform rating. “A now stronger outlook for Urology/GYN and general surgery gave management confidence to raise ’16 procedure guidance,” Newitter wrote in his research note. “Also, management seems to be talking more aggressively about da Vinci use in thoracic, a procedure area we think may be around the corner as an emerging growth driver.” Piper Jaffray analyst Matt O’Brien raised his price target to 610 from 550. He rates the stock neutral. Intuitive Surgical stock hit a record high of 654.88 early on the stock market today , pushing it up 20% for the year. In morning trading, shares were up 4.5% near 652.

Edwards Lifesciences Soars To New High As Heart Valve Aces Trial

Leading medical-device maker Edwards Lifesciences ( EW ) jumped in early trading Monday, a day after its artificial heart valve passed a hurdle that could greatly expand its market. Edwards conducted a large clinical trial comparing its transcatheter aortic valve replacement (TAVR), Sapien 3, to traditional open-heart surgical valve replacement in patients with aortic stenosis, or shrinking of the aortic valve of the heart, who were characterized as “intermediate risk” for open-heart surgery. The study followed up on patients 30 days after surgery and again a year later, and it found that deaths and strokes were both significantly lower in the Sapien group. Sapien 3, which is delivered via catheter through a small incision in the patient’s thigh, was approved in June 2015 for patients who were at high risk if they had open-heart surgery. Adding the intermediate-risk population to the patient pool led several analysts to hike their sales estimates for the product. “We estimate the patient population could increase 50% to 150,000 to 200,000, including intermediate-risk patients,” wrote Canaccord Genuity analyst Jason Mills in a research note, as he raised his price target on Edwards Lifesciences stock to 113 from 95. “We increase our Edwards 2016 sales estimate to $2.796 billion from $2.779 billion and pro forma EPS forecast to $2.72 from $2.68. For 2017, our top-line projection increases to $3.1 billion from $3.06 billion and pro forma EPS to $3.21 from $3.09.” Edwards stock was up 18% in morning trading on the stock market today , hitting a new lifetime high of 106.10. The stock was already doing well, ranking at No. 23 on the IBD 50 and also rating a spot on IBD’s Leaderboard . It’s 27% over an 83.53 buy point, and thus in the profit-taking zone. The news also led analysts to lift their estimates for the entire TAVR market, which is currently split between Edwards’ Sapien and Medtronic ‘s ( MDT ) CoreValve. Leerink’s Danielle Antalffy raised her estimate for the global market in 2021 to $4.8 billion from $4.4 billion. “With Edwards’ Sapien 3 likely the only valve available in the intermediate-risk patient population for at least the next 12 months, we assume the majority of the incremental market opportunity benefit falls to Edwards,” Antalffy wrote in her research note, in which she raised her price target on the stock to 115 from 93. BTIG analyst Sean Lavin upgraded the stock to buy from neutral, with a price target of 115. Medtronic stock was up more than 1% in morning trading, near 76.