Market overreacts to Abiomed’s adjusted guidance in FY22 Q2 results, says GlobalData

  • Abiomed demonstrated strong resilience to the first wave of the COVID-19 pandemic
  • Guidance for FY22 was originally set at $990m-$1.03bn, after FY22 Q1 guidance was boosted to $1.03bn-$1.05bn, and finally adjusted this quarter to $1.01bn-$1.03bn
  • Abiomed’s 36.7% revenue growth in FY22 H1 compared to FY21 H1 has been ignored entirely as ABMD share price continues to decline

Following the announcement of Abiomed’s FY22 Q2 results, Richard Hyde, Medical Analyst at GlobalData, a leading data and analytics company, offers his view:

“Abiomed’s Q2 report is highlighted by remarkable revenue growth, strategic investments, positive regulatory feedback, zero debt position, and adjusted FY22 guidance. Since the release, ABMD’s share price has declined as investors seem to have tunnel vision on the slightly adjusted revenue guidance for the rest of FY22. Abiomed credited the unknown future impacts of COVID-19 variants and medical labour force shortages as the reason for the reduced guidance. Still, Abiomed is predicted to turn in its first billion-dollar fiscal year, which will represent an 18% revenue growth. Additionally, Abiomed’s recent acquisitions of Breethe and preCARDIA demonstrate its commitment to expanding its position in the heart failure sector.

“GlobalData has estimated that IABP catheter usage rates are declining for the treatment of cardiogenic shock, while usage of percutaneous ventricular assist devices like Abiomed’s Impella are rapidly increasing. Abiomed is estimated to control nearly 90% of the percutaneous VAD market and is likely to have further boosted its position in APAC and Europe based on the currently reported regional growth rates.

“When it comes to forecasting Abiomed’s future growth and performance, its zero-debt position should be the only criticism. Abiomed has proudly proclaimed its continuing zero debt status, however, this perceived refusal to take on debt may be hindering growth opportunities, especially in foreign markets, as well as reducing the company’s buying power for future acquisitions. Overall, Abiomed is still a dominant player in the heart failure device sector with rapidly growing revenue estimates for the future.”

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