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Abiomed stock falls to yearly low

Abiomed Inc. (NASDAQ: ABMD) stock fell to a yearly low of $270.25 on Thursday. Investors remained concerned about the future of the provider of temporary mechanical circulatory support devices. However, a unique product portfolio and robust demand for its Impella line of products could be beneficial for the company.

The data from the company’s flagship Impella heart pump showed a significant increase in cardiogenic shock survival and heart recovery in patients. The survival rates have risen from 51% to 67% since approved for treating cardiogenic shock. The product has been driving the company’s top line since inception.

The US cardiovascular devices market is likely to reach $15.7 billion by 2021, according to Statista. Competition has been rising among the companies for the treatment of heart-related diseases. The company’s products compete with a temporary cardiac assist device from Thoratec. It also faces immense competition from permanent heart assist products developer including Thoratec, Teleflex, HeartWare, Jarvik Heart and MicroMed Technology.

Image Courtesy: Abiomed

Majority of the analysts recommended a “strong buy” or “buy” rating while expecting the stock to reach $435.10 per share in the next 52 weeks. They believed the company’s flagship product would be driving the top line growth for the near-term. Also, the analysts expect positive developments to drive the shares of Abiomed.

For the third quarter, the company posted a 235% jump in earnings as an increase in worldwide Impella heart pump revenue drove total revenues higher by 30%. US Impella product revenue increased by 27% with US patient usage of the Impella heart pumps up 24%. Outside the US, Impella product revenue climbed by 59%, due to the strength in Germany and Japan.

For fiscal 2019, the company had expected revenue to be about $780 million, which is an increase of about 31% from the prior year. Operating margin was anticipated to be in the range of 29% to 29.5%. The company remained focused on disciplined execution and sustainable growth so that even more patients around the world can benefit from heart recovery.

Shares of Abiomed opened lower on Thursday and is trading in the red territory. The stock has fallen over 9% in the past year and over 18% in the past three months.

 

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