Abiomed shares down despite Street-beating FY2019 Q1, Indian Impella approval

Shares in Abiomed (NSDQ:ABMD) have fallen today despite the medical device maker posting earnings that beat expectations by Wall Street for its fiscal year 2019 first quarter and announcing approval of its Impella heart pump in India.

The Danvers, Mass.-based company posted profits of $90.1 million, or $1.95 per share, on sales of $180 million for the three months ended June 30, seeing profits grow 141% while sales grew 35.9% compared with the same period during the previous year.

Earnings per share were well ahead of the 82¢ consensus on Wall Street, where analysts expected to see sales of $173.2 million, which the company also beat.

“Abiomed reported a strong start to our fiscal year 2019. Abiomed is committed to sustainable growth and improving patient outcomes each quarter. We do this through advanced training, product enhancements and sharing of best practices derived from real world experience,” prez & CEO Michael Minogue said in a press release.

Abiomed lifted the low end of its full fiscal year 2019 revenue guidance by $15 million, now expecting to post between $755 and $770 million, up 27% to 30% over the previous year. The company said it is maintaining its existing 2019 GAAP operating margin guidance of between 28% and 30%.

Shares in Abiomed have fallen 14.8% so far, at $367.11 as of 10:00 a.m. EDT.

Despite beating expectations, Leerink Partner analyst Danielle Antalffy was skeptical that share prices would rise after the news, but said that trading down would give buyers a good opportunity to invest in the company.

“Given the high expectations into the quarter and the fact that shares are trading at nearly 20x EV/sales on FY2020 estimates, we do think the shares could trade down on this print. But given what we believe are a number of positives not least of which includes a guidance raise above the beat and Indian approval, we’d use any weakness as a buying opportunity given that we believe recent sales outperformance and therefore stock appreciation is sustainable, in our view,” Antalffy said in a letter to investors.

The company also announced that its Impella 2.5, Impella CP and Impella 5.0 heart pumps received clearance from India’s Central Drugs Standard Control Organization, now indicated for use during high-risk percutaneous coronary interventions, cardiogenic shock and to treat other reduce left ventricular function conditions.

Abiomed said that the devices have already been used to treat the first patient in the region, with the first procedure taking place at New Delhi’s Fortis Escorts Heart Institute by Dr. Ashok Seth.

“We are proud to be the first Heart Recovery Program in India. The Impella heart pump unloads the left ventricle and allows the heart to rest and recover so that patients may gain an improved quality of life. We look forward to providing access to protected revascularization to improve their cardiac function and subsequent quality of life for more patients with heart failure, cardiogenic shock or left ventricular dysfunction,” Dr. Seth said in a prepared statement.

“Abiomed is committed to expanding access to our heart recovery products around the world. We are moving forward to establish Heart Recovery Programs in India, starting with limited centers of excellence in New Delhi and Jaipur. We commend the dedication of Dr. Seth and his team for providing advanced technology to improve outcomes for patients who now have the opportunity for an improved quality of life,” prez & CEO Minogue said in a press release.

In May, Abiomed saw shares rise after it beat expectations on Wall Street and saw massive growth to its profits in its fourth quarter and full fiscal year 2018 earnings results.

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