Baron Asset Fund on Edwards Lifesciences Corporation
Thesis
Baron initiated Edwards Lifesciences because of its leadership in transcatheter aortic valve replacement and its emerging mitral and tricuspid valve therapies. The team believes the TAVR market can expand from roughly $7 billion to more than $10 billion as indications broaden, while competitor exits and weak competing clinical data could shift additional market share to Edwards. The TMTT opportunity could grow from about $1.5 billion to as much as $8 billion, creating a combined addressable market approaching $20 billion. With high gross and operating margins and a more stable competitive environment, Baron expects low-double-digit revenue growth and mid-teens earnings-per-share growth for an extended period.
“With a combined addressable market of nearly $20 billion, we believe Edwards has meaningful opportunity to compound growth.”