Netflix inventory has greater than doubled this 12 months due to sturdy positive factors in earnings and subscribers. However Netflix will not be the very best performer within the S&P 500 in 2018.
Neither is Twitter ( or )Amazon (. Nope. The title belongs to an index beginner known as Abiomed. The medical gadget firm was added to the S&P 500 in late Might. )
Abiomed ( inventory is up practically 125% this 12 months. The corporate makes the Impella coronary heart pump, a tool that helps increase circulation and cardiac efficiency. )
Abiomed is doing properly for a lot the identical motive as Netflix (. Each corporations have one thing buyers care about: sturdy gross sales and revenue progress. )
Wall Road analysts count on Abiomed to report gross sales progress of about 30% this 12 months and subsequent 12 months. Earnings ought to soar about 45% this 12 months and practically 35% subsequent 12 months. Analysts have been persistently elevating revenue forecasts for the corporate, and Wall Road continues to like the inventory though it has greater than doubled. 9 of the 11 analysts following Abiomed have a purchase ranking on it.
Associated: Is the binge over for Netflix inventory?
However Abiomed, like Netflix, is a particularly costly inventory.
Shares commerce at 120 occasions revenue forecasts for the 12 months. Bigger medical gear corporations Medtronic ( and )Abbott Laboratories ( commerce at 17 and 22 occasions earnings estimates for 2018. (Disclosure: The reporter of this story owns shares of Abbott Laboratories.) )
Abiomed’s reliance on Impella additionally makes it a bit dangerous. The corporate stated in Might that the guts pump accounted for practically all of its gross sales final quarter. Traders will hear extra from Abiomed on July 26 when it releases its newest earnings.
Being a one-trick pony can work out simply fantastic although if that specific horse is a champion thoroughbred.
Simply take a look at how a lot cash Apple ( makes from the iPhone and )Fb ( generates from promoting, for instance. )
So if Abiomed experiences one other spherical of sturdy outcomes, it may widen its lead atop the S&P 500 over extra well-known tech giants.
CNNMoney (New York) First printed July 16, 2018: 11:22 AM ET