Author Archives: Scalper1

Edwards Lifesciences Soars To New High As Heart Valve Aces Trial

Leading medical-device maker Edwards Lifesciences ( EW ) jumped in early trading Monday, a day after its artificial heart valve passed a hurdle that could greatly expand its market. Edwards conducted a large clinical trial comparing its transcatheter aortic valve replacement (TAVR), Sapien 3, to traditional open-heart surgical valve replacement in patients with aortic stenosis, or shrinking of the aortic valve of the heart, who were characterized as “intermediate risk” for open-heart surgery. The study followed up on patients 30 days after surgery and again a year later, and it found that deaths and strokes were both significantly lower in the Sapien group. Sapien 3, which is delivered via catheter through a small incision in the patient’s thigh, was approved in June 2015 for patients who were at high risk if they had open-heart surgery. Adding the intermediate-risk population to the patient pool led several analysts to hike their sales estimates for the product. “We estimate the patient population could increase 50% to 150,000 to 200,000, including intermediate-risk patients,” wrote Canaccord Genuity analyst Jason Mills in a research note, as he raised his price target on Edwards Lifesciences stock to 113 from 95. “We increase our Edwards 2016 sales estimate to $2.796 billion from $2.779 billion and pro forma EPS forecast to $2.72 from $2.68. For 2017, our top-line projection increases to $3.1 billion from $3.06 billion and pro forma EPS to $3.21 from $3.09.” Edwards stock was up 18% in morning trading on the stock market today , hitting a new lifetime high of 106.10. The stock was already doing well, ranking at No. 23 on the IBD 50 and also rating a spot on IBD’s Leaderboard . It’s 27% over an 83.53 buy point, and thus in the profit-taking zone. The news also led analysts to lift their estimates for the entire TAVR market, which is currently split between Edwards’ Sapien and Medtronic ‘s ( MDT ) CoreValve. Leerink’s Danielle Antalffy raised her estimate for the global market in 2021 to $4.8 billion from $4.4 billion. “With Edwards’ Sapien 3 likely the only valve available in the intermediate-risk patient population for at least the next 12 months, we assume the majority of the incremental market opportunity benefit falls to Edwards,” Antalffy wrote in her research note, in which she raised her price target on the stock to 115 from 93. BTIG analyst Sean Lavin upgraded the stock to buy from neutral, with a price target of 115. Medtronic stock was up more than 1% in morning trading, near 76.

Market Lab Report – Premarket Pulse 4/4/16

Major averages had an upside reversal day to close higher on mixed volume after a strong employment report. The report at first pushed markets lower as it moved the Fed closer to hiking rates, but as we stated in our PMP on 4/1/16, Fed Chair Yellen recently acknowledged that global growth is an important factor with respect to any rate hikes as a premature hike could further derail the already fragile global economy. So despite a strong employment report, Yellen’s dovish stance continues to have a bullish impact as it ultimately postpones any rate hikes as long as global growth remains stagnant. Website hosting company GoDaddy (GDDY) had an upside reversal pocket pivot breakout off its handle. GDDY is a leader in its space. Institutional sponsorship has grown in every quarter since the company went public 3 quarters ago, group rank 84.. Advanced surgical system company Intuitive Surgical (ISRG) had an upside reversal pocket pivot, closing at new highs. Pretax margin 40.4%, group rank 58. Upside reversals on higher volume are strong patterns, thus often directly precede higher prices. That said, this bullish action needs to be weighed against buying stocks on weakness closer to their respective moving averages since such stocks may not trade all the way down to such levels.

Tesla Stock Gains Monday As Model 3 Reservations Pass 276,000

Loading the player…   Tesla Motors ( TSLA ) stock climbed 4% in premarket trading Monday, compounding Friday’s gain as reservations for its new Model 3 electric car soared far beyond views. CEO Elon Musk tallied 276,000 reservations by the beginning of Sunday and said he’d give another update Wednesday. The pre-order period opened Thursday ahead of a Thursday-night reveal event. Musk said in Twitter posts that  he’s definitely going to have to rethink production planning. Tesla had expected only one quarter to one half of the 115,000 reservations that came in before anyone even got to see what the car looked like. The refundable reservations are $1,000 each and worth $11.6 billion dollars in revenue if everybody were to go through with a purchase. “While there was clearly a lot of excitement and optimism around both the car and the company, roughly one-third of the respondents we talked to sounded undecided on whether they would actually purchase when the option came up in two years,” Pacific Crest Securities analyst Brad Erickson said in a research note written Friday and distributed late Sunday. The focus now is on how all the numbers — and Tesla stock — will play out. The company has just effectively crowdfunded more than a quarter billion dollars from reservations. That’s more than it raised in its IPO. The 276,000 reservations worldwide also tops the number of electric and plug-in hybrid vehicles sold around the U.S. in the last two years by the entire auto industry. And it’s more than the 245,000 BMW passenger cars sold in the U.S. last year. Tesla delivered almost 51,000 electric vehicles — its Model S sedan and Model X crossover — last year worldwide. Tesla Stock Analysis Going into Monday, Tesla stock was just below where it started 2016. It closed Friday at 237.59 after hitting its highest point since early October. The stock isn’t highly rated by IBD now, factoring in its history of losses and earnings, stock performance and other factors. The Model 3 is the electric car meant for the entry-level luxury mass market, priced at $35,000 for the base model before any tax credits. Musk expects the average purchase price with add-ons to be $42,000. The car is seen as a challenger to BMW’s 3 Series and similarly priced models from Daimler ’s ( DDAIF ) Mercedes-Benz, Volkswagen ’s ( VLKAY ) Audi and Toyota ’s ( TM ) Lexus, as well as electrics like General Motors ’ ( GM ) Chevrolet Bolt EV. Among the many things analysts and investors will be deconstructing is how much content from Tesla’s tech partners Nvidia ( NVDA ) and Mobileye ( MBLY ) go into the Model 3. Nvidia chips power the entertainment console in Tesla’s current vehicles. Mobileye is a maker of camera-based advanced driver assistance systems, and its technology is used by Tesla in conjunction with Autopilot self-driving car features. RELATED: Tesla Model 3 Reservations Hit 276,000 By Sunday