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SWAV update ..IBD

TECHNOLOGY
Shockwave Surges On Quarterly Beat After Boston Science Takeover Reportedly Fizzles

On the same day its merger talks with Boston Scientific (BSX) reportedly broke down, Shockwave Medical (SWAV) also beat first-quarter expectations. In response, SWAV stock surged late Monday.

During the March quarter, Shockwave earned $1.03 per share on $161.1 million in sales. Earnings more than doubled year over year, rocketing 164%, and soundly beating forecasts for 79 cents, according to FactSet. Sales advanced 72% and topped expectations for $147.3 million.

In after-hours trades on today's stock market, SWAV stock jumped 4% near 286. Shares fell 4.6% at 274.96 during the regular session after takeover talks with Boston Scientific reportedly fell apart, StreetInsider reported. Boston Scientific stock jumped 3.1% to close at 53.12.

SWAV Stock: Bullish Growth Expected

The two companies couldn't agree on a price, an insider reportedly told StreetInsider. Boston Scientific offered $275 per share of SWAV stock. But Shockwave shares hit a recent high at 300 in late April.

Representatives of the two companies declined to comment to Investor's Business Daily.


The potential deal could bolster Boston Scientific's cardiovascular portfolio. Shockwave's technology uses electrical impulses to "crack" hardened calcium in the arteries. The process called intravascular lithotripsy is an alternative to atherectomy, which uses a small drill to remove calcifications.

Needham analyst Mike Matson noted in a recent report that the intravascular lithotripsy market is worth about $8.5 billion. This implies just 6% of the market was penetrated last year.

For the year, Shockwave predicted $700 million to $720 million in sales, up 43%-47%. That's up from the company's earlier outlook for $660 million to $680 million. SWAV stock analysts call for earnings of $3.72 per share and $671.5 million in revenue.

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