EW – Market expectations are for significant Uniform ROA expansion, but management appears concerned about growth, enrollment, and pricing

• Edwards Lifesciences Corporation (EW:USA) trades above recent averages relative to UAFRS-based (Uniform) Earnings, with a 39.3x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management appears concerned about growth, CLASP study enrollment, and pricing pressures
• Specifically, management may lack confidence in their ability to sustain growth in TAVR therapy, PASCAL market penetration, and international sales, specifically in Europe. Moreover, they may be concerned about sales seasonality, margin headwinds, and the progress of their CLASP study enrollment. Furthermore, they may be exaggerating the growth opportunities for TAVR centers and their ability to increase the number of patients treated. Finally, they may lack confidence in their ability to execute a premium pricing strategy for PASCAL, meet mitral sales guidance, and combat TAVR pricing pressures.