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Abiomed (ABMD) Earnings and Revenues Beat Estimates in Q2

Zacks Equity Research

Abiomed Inc. ABMD reported second-quarter fiscal 2018 earnings of 44 cents per share, which came ahead of the Zacks Consensus Estimate of 37 cents. The figure was also higher than 20 cents in the year-ago quarter.

In the reported quarter, revenues increased roughly 29% year over year to $132.8 million approximately, outpacing the Zacks Consensus Estimate of $131.0 million. The year-over-year upside was supported by robust performance of the Impella heart pump product line.

Quarter Highlights

Global revenues of the manufacturer, developer and marketer of medical products surged 30% to $127.4 million in the quarter.

U.S. Impella revenues improved 27% to $113.6 million (driven by a 33% increase in patient utilization). Outside the United States, revenues surged 61% to $13.8 million. Germany accounted for the majority of the international revenues, which grew 64% on a year-over-year basis.

During the reported quarter, the installed base for Impella 2.5 heart pumps in the United States grew by 17 hospitals, taking the installed customer base total to 1,171 sites. The installed customer base for Impella CP heart pumps grew by 31 U.S. hospitals, reaching a total of 1093.

Overall operating income for the reported quarter came in at $31.7 million or 24% of operating margin (as a percentage of revenues), compared with $14.5 million or 14% in the prior-year quarter.

Abiomed’s gross margin in the quarter was 84% compared with 83% in the second quarter of fiscal 2016.

 

ABIOMED, Inc. Price, Consensus and EPS Surprise

ABIOMED, Inc. Price, Consensus and EPS Surprise | ABIOMED, Inc. Quote

Financial Condition

Abiomed’s cash and cash equivalents were $44.5 million as of Sep 30, compared with $39.0 million as of Mar 31. Notably, management announced that the company currently has no debt.

Guidance

Abiomed forecasts fiscal 2018 revenues in the range of $565 million to $575 million. This marks an increase of 27-29% from the fiscal 2016 level. Operating margin is projected in the band of 23% to 25%.

Our Take

Further, we believe that robust demand for the Impella product line will continue to drive Abiomed’s top line over the long term. The company’s expanding product portfolio will improve its penetration into both the prophylactic high-risk PCI and cardiogenic shock patient market. This is evident from the fact that both Impella 2.5 and CP continue to add centers in the United States. New publications regarding the devices in leading medical journals help in promoting their utilization and effectiveness.

Although Abiomed’s significant international presence helps broaden customer base among other positives, fluctuations in currency exchange rates can adversely impact the company’s international sales. Fluctuations in currency exchange rates can adversely impact Abiomed’s international sales, although the company’s international presence broadens its customer base.

Zacks Rank & Key Picks

Abiomed holds a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A few other top-ranked stocks in the broader medical sector include PetMed Express, Inc PETS, Abbott ABT and Intuitive Surgical, Inc ISRG. While, PetMed sports a Zacks Rank #1, Abbott and Intuitive Surgical carry a Zacks Rank #2.

PetMed reported EPS of 43 cents in the second quarter of fiscal 2018, up 79.2% from the year-ago quarter’s 24 cents. Also, gross margin expanded 548 bps year over year to 35.2% in the reported quarter.

Abbott reported third-quarter 2017 adjusted earnings from continuing operations of 66 cents per share, up 11.9% year over year. Also, third-quarter worldwide sales totaled $6.83 billion, up 28.8% year over year.

Intuitive Surgical posted adjusted earnings of $2.77 per share in the third quarter of 2017, up 34.5% on a year-over-year basis. Also, revenues increased 18% year over year to $806.1 million.

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