With the market having one of the wildest months in memory, stocks shot up and down last week as momentum continued its rampage and some technology stocks blew out numbers. A new report from Jefferies cautions that the momentum surge is getting overextended and reminded investors that the stocks tend to go down much faster than they go up. The report did focus on new growth stock ideas to buy.
The Jefferies analysts’ focus picks may seem like momentum, but truly have outstanding underlying fundamentals, and despite a few having tremendous moves lately, the Jefferies team sees plenty of upside.
This company pioneered the artificial heart valve and could be poised for big growth. Edwards Lifesciences Corp. (NYSE: EW) provides products and technologies to treat structural heart disease and critically ill patients worldwide. The company offers transcatheter heart valve therapy products, comprising transcatheter aortic heart valves and their delivery systems for the nonsurgical replacement of heart valves. The company also provides surgical heart valve therapy products, such as pericardial valves for aortic and mitral replacement, and minimally invasive aortic heart valve system, as well as tissue heart valves and repair products, which are used to replace or repair a patient’s diseased or defective heart valve.
The Jefferies team thinks that the company’s recent announcement that it will acquire privately held CardiAQ makes good sense going forward. CardiAQ has human implants of transcatheter mitrial valves, and Edwards is focused on the mitrial valve opportunity after its very strong success in aortic valves.
The company has also had tremendous success with transcatheter valve replacement. Transcatheter heart valve replacements are rapidly gaining favor in the medical community for use in those patients who are deemed unsuited for open heart surgery, and they are a fast growing revenue stream for the company.
The Jefferies price target, which appears low at this point, is $155. The Thomson/First Call consensus target is $159.88. The stock closed Friday at $154.30.