Medical device company HeartWare International (NASDAQ: HTWR) saw its share price pose a remarkable recovery after being battered in the opening session on Friday. Before the market opened, the company reported an increase in its fiscal 2012 third-quarter revenue compared to the similar period last year. However, the net loss for the third quarter widened from the year-ago corresponding quarter, primarily due to higher research and development expenses. Both revenue and earnings missed analysts’ estimates.
The Massachusetts-based HeartWare manufactures miniaturized implantable heart pumps or ventricular assist devices (VAD) for the treatment of advanced heart failure.
Revenues for the fiscal 2012 third quarter increased marginally to $22.86 million from $21.34 million in the corresponding quarter of 2011. The revenue estimate of analysts was $25.88 million for the third quarter of fiscal 2012.
The net loss for the reported quarter widened to $24.99 million, or $1.75 per share, from $13.96 million, or $1.00 per share, in the comparable period of fiscal 2011. The net loss estimate of analysts was $1.53 per share for the third quarter of 2012.
The research and development expenses for the third quarter increased to $21.38 million from $12.71 million in the prior-year corresponding quarter. HeartWare clarified that increased research and development costs are related to the developments in HeartWare’s pipeline technologies.
Commenting on the results, Doug Godshall, President and CEO of HeartWare, said, “We are pleased to have maintained strong international growth, particularly during the summer months of Europe, as 214 HeartWare Ventricular Assist Systems were sold outside the U.S. in the third quarter of 2012, a 51% increase compared to 142 in the third quarter of last year.”
The share price of HeartWare, which was trading at around $70.00 in the month of April 2012, rose to $80.00 following FDA approval for the company’s ventricular assist system. On May 25, Zacks Equity Research published a positive report about HeartWare. That document triggered another round of buying, resulting in a rise in the share price to $89.35 on June 18. A Seeking Alpha report indicating the possibility of FDA approval for the company’s heart pump lifted the share price to a 52-week high of $97.31 on October 2.
On Friday, the share price of HeartWare opened $2.82 below the previous close of $82.05. In less than an hour, the stock price retraced all of its losses and posed a gain of over $3.57 per share to reach $85.62. However, renewed selling pulled the share price down to the previous close at noon. For the rest of the day, the share price oscillated around the previous close.
HeartWare ended Friday’s trading session at $82.52 per share, up $0.47, or 0.6%, on a volume of 272,721 shares.
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