Edwards Lifesciences Bumps up Against Staffing Shortages in Second Quarter; Slight Cut to Our FVE

Edwards Lifesciences delivered uncharacteristically muted second-quarter results, and we’ve modestly lowered our fair value estimate by $3 to $93 per share after dialing down our assumptions for 2022 and 2023 to reflect foreign currency headwinds and pressure on procedure volume that is expected to linger into 2023. Despite these near-term issues, we see little to change our thinking on Edwards’ narrow economic moat. Indeed, the firm’s ongoing development of its transcatheter mitral valve therapies and supporting clinical trials should add to the intangible assets that support the moat.