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ABIOMED (ABMD) Announces Preliminary Q3 Results, Slashes View

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ABIOMED, Inc. ABMD recently announced preliminary results for third-quarter fiscal 2020.

Revenues are anticipated at $221.6 million, suggesting a 10% year-over-year rise but below the Zacks Consensus Estimate of $227.1 million.

The company is scheduled to release full financial results on Feb 6, before market open.

Investors Not Happy

ABIOMED’s fiscal third-quarter preliminary results have dampened investors’ spirits. Share price of this Zacks Rank #3 (Hold) company plummeted 11% to close at $168.10 since the release.

Also, shares of ABIOMED have plunged 48.4%, against the industry's 16.5% growth, over the past year. The current level also lags the S&P 500’s rally of 28.3%.

View Slashed

ABIOMED slashed its fiscal 2020 revenue guidance.

The company expects revenues within $846-$877 million, indicating an increase of 10-14%, year over year. This is compared to the earlier projected range of $885-$925 million, calling for a 15-20% rise year over year. The Zacks Consensus Estimate for the same stands at $886.24 million, much above the guided range.

ABIOMED, Inc. Price and Consensus

ABIOMED, Inc. Price and Consensus
ABIOMED, Inc. Price and Consensus

ABIOMED, Inc. price-consensus-chart | ABIOMED, Inc. Quote

Quarter Highlights

In the fiscal third quarter, ABIOMED’s international growth was 24%, while U.S. patient usage grew 16% year over year. U.S. revenues grew 8% year over year to $185.6 million.

Internationally, revenues totaled $36.0 million, up 29% year over year buoyed by strength in Germany and Japan.

Per management, ABIOMED was negatively impacted by two conference presentations, which were said to be based on misleading analyses.

Summing Up

ABIOMED is confident to have gained from its flagship Impella product line in the third quarter. Revenues from Germany and Japan have driven sales in the quarter, while U.S. patient use also rose year over year. However, a slashed guidance for fiscal 2020 is concerning.

Earnings of Other MedTech Majors at a Glance

Some better-ranked stocks in the broader medical space are Cerner Corporation CERN, DexCom DXCM and HealthEquity HQY. While HealthEquity sports a Zacks Rank #1 (Strong Buy), Cerner and DexCom carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cerner’s long-term earnings growth rate is 13.6%.

DexCom’s fourth-quarter earnings growth rate is projected at 31.5%.

HealthEquity’s long-term earnings growth rate is 25%.

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