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Edwards Lifesciences (EW) Surges 6.3%: Is This an Indication of Further Gains?

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Edwards Lifesciences EW shares soared 6.3% in the last trading session to close at $95.24. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 11.2% gain over the past four weeks.

Edwards Lifesciences scored a strong price rise driven by its encouraging first-quarter 2021 results, with adjusted earnings and net sales both surpassing the Zacks Consensus Estimate by 14.9% and 4.9%, respectively. The company’s raised 2021 adjusted earnings guidance that along with better-than-expected Q2 earnings outlook also buoy optimism.

Price and Consensus

Price Consensus Chart for EW
Price Consensus Chart for EW

This medical device maker is expected to post quarterly earnings of $0.51 per share in its upcoming report, which represents a year-over-year change of +50%. Revenues are expected to be $1.25 billion, up 34.6% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Edwards Lifesciences, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on EW going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>


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