Edwards Lifesciences' Strong Q1 Results Held Few Surprises; No Change to Our Fair Value Estimate

Edward Lifesciences posted another quarter of double-digit top and bottom line growth that generally met our expectations, and we’re leaving our fair value estimate unchanged for now. While the omicron variant depressed procedure volume in January, procedures resumed as the quarter unfolded. However, even as patients return for heart valve treatment, hospital labor shortages have continued to exert pressure on procedure volume, which we think could act as a drag on Edwards through the rest of the year. Despite these changing conditions in the hospital, we remain confident in Edwards’ narrow moat, supported by intangible assets, as well as some switching costs associated with its Sapien TAVR product.