Some Edwards Lifesciences Corporation (NYSE:EW) Analysts Just Made A Major Cut To Next Year's Estimates

One thing we could say about the analysts on Edwards Lifesciences Corporation (NYSE:EW) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

Following the latest downgrade, the current consensus, from the 17 analysts covering Edwards Lifesciences, is for revenues of US$5.8b in 2024, which would reflect a noticeable 6.5% reduction in Edwards Lifesciences' sales over the past 12 months. Statutory earnings per share are supposed to sink 10% to US$2.29 in the same period. Previously, the analysts had been modelling revenues of US$6.5b and earnings per share (EPS) of US$2.59 in 2024. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a real cut to earnings per share numbers as well.

See our latest analysis for Edwards Lifesciences

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Analysts made no major changes to their price target of US$79.82, suggesting the downgrades are not expected to have a long-term impact on Edwards Lifesciences' valuation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 13% by the end of 2024. This indicates a significant reduction from annual growth of 8.0% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 8.1% annually for the foreseeable future. It's pretty clear that Edwards Lifesciences' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Edwards Lifesciences. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Edwards Lifesciences' revenues are expected to grow slower than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on Edwards Lifesciences after the downgrade.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Edwards Lifesciences analysts - going out to 2026, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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