Abiomed Inc.ABMD

Morningstar Rating

Stock Research and Analysis

by Julie Stralow, CFA

Abiomed is waking from its slumber as a research shop, and we admire its new commercial initiatives. However, the firm still has much to prove to investors as it ushers its most promising products into the U.S. market and generates losses rather than cash flow. Read more

Bulls Say

The Impella 2.5 could put Abiomed on a high-growth trajectory if it becomes the standard of care for high-risk angioplasty and heart attack patients.

Abiomed recently received FDA approval for its iPulse console to run recovery VADs and intra-aortic balloon pumps on one machine. Along with Impella, the iPulse could help Abiomed enter the cath lab, extending its reach outside of its historical stronghold in the surgical suite.

Introduced in calendar 2004, AB 5000 recovery VADs may continue growing at a fast pace, as they can support many more potential cardiac shock patients than Abiomed's first-generation recovery VAD, the BVS 5000. Read more

Bears Say

Abiomed's prospects largely rely on products that were only recently approved for marketing. They may not live up to expectations in the marketplace for a variety of reasons.

The high-priced Abiocor artificial heart might never become a major revenue generator for Abiomed, given its limited patient pool and small set of doctors who could perform the procedure.

Abiomed has a lot on its plate, and the organization may find it difficult bringing a new manufacturing facility on line, launching new products, and expanding existing products all at once. Read more

Strategy

Abiomed aims to make heart recovery the standard of care for acute heart failure events. After such events, its devices assume all or a portion of the heart's pumping function, letting the heart rest and heal while maintaining blood flow throughout the body. Read more

Management

Despite its disappointing history in terms of creating shareholder value, we give Abiomed a B Stewardship Grade. Abiomed started overhauling its management team in 2004 when Michael Minogue was recruited to lead the firm as chairman, president, and CEO. Read more

Profile

Abiomed was founded in 1981 to develop an artificial heart and reached that goal in 2006 when the Food and Drug Administration approved the Abiocor for chronic heart failure. Read more

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