Edwards Lifesciences provides products and technologies to treat structural heart disease and critically ill patients worldwide. It is a manufacturer of heart valve systems and repair products used to replace or repair a patient's diseased or defective heart valve. The company was founded in 1999 and is based in Irvine, California.
EW Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Edwards Lifesciences Corp with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Edwards Lifesciences Corp ranked in the 13th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 81.83%. The most interesting components of our discounted cash flow analysis for Edwards Lifesciences Corp ended up being:
In the past 5.53 years, Edwards Lifesciences Corp has a compound free cash flow growth rate of -0.03%; that's better than just 22.67% of cash flow producing equities in the Healthcare sector, where it is classified.
The business' balance sheet suggests that 2% of the company's capital is sourced from debt; this is greater than merely 6.98% of the free cash flow producing stocks we're observing.
EW's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 59.47% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
IDXX, QGEN, A, MGLN, and RVP can be thought of as valuation peers to EW, in the sense that they are in the Healthcare sector and have a similar price forecast based on DCF valuation.