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Do Analysts See Any Upside for Abiomed Stock?

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Abiomed’s bottom line

In this year’s second quarter, Abiomed’s (ABMD) net investment income rose YoY (year-over-year) to $1.67 million from $781,000. Abiomed received an income tax benefit of $1.71 million during the second quarter. In comparison, it received an income tax benefit of $7.98 million in the previous year’s period.

The company’s net income rose YoY to $50.13 million from $24.5 million, translating to net EPS of $1.09 compared to $0.54 in the previous year’s period.

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Analysts’ recommendations

Of the 11 analysts covering Abiomed, six have given it “strong buys,” and five have given it “buys.” The mean rating for Abiomed stock is 1.45, and its consensus target price is $446.1, implying a potential 53.7% upside based on its December 21 closing price of $290.29.

Peers’ ratings

In comparison, peers Abbott Laboratories (ABT), Boston Scientific (BSX), and Edwards Lifesciences (EW) have received mean ratings of 1.77, 1.43, and 2.33, respectively, from analysts, and they have target prices of $79.58, $42.41, and $170.15, respectively.

Abiomed’s current ratio, which shows how effectively it can meet its short-term obligations, is 6.90x. In comparison, Abbott’s, Boston Scientific’s, and Edwards Lifesciences’ current ratios are 1.40x, 0.80x, and 2.30x, respectively.

Stock performance

After a stellar rise from $202.32 on January 5 to a high of $449.75 on September 28, Abiomed stock corrected to $299.41 on November 23. Since then, after initial buying interest took it to $343.45 on December 3, Abiomed stock has again corrected to its current $290 level amid broader market fluctuations.

Abiomed’s price-to-free cash flow ratio is 85.40x, whereas peers Abbott, Boston Scientific, and Edwards Lifesciences have price-to-free cash flow ratios of 40.72x, 51.23x, and 37.80x, respectively.

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