Is There Any Reason To Invest In Edwards Lifesciences Stock?
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Edwards Lifesciences (EW) stock returned 24.2% over the past year, against 12.2% for the S&P 500. Part of the case for owning the stock is the buyback. Edwards cut its diluted share count by 5.2% over three years, leaving each remaining share with a slightly bigger slice of the business. For you, that matters only if the heart-valve maker continues producing the cash to fund the buyback and the profit behind each share. So does each Edwards share earn more than it did three years ago?
Does Each Edwards Share Earn More Than Before?
Not on reported numbers. Edwards earned $1.77 per diluted share over the four quarters to September 30, 2026, against $2.34 for the same stretch three years earlier. That is a fall of 8.9% a year. Net income fell faster, dropping by 10.6% a year, so the shrinking share count softened the decline but did not turn it into growth. The earlier figure includes the Critical Care business, which Edwards sold in September 2024. On the adjusted basis management reports, earnings per share rose to $2.35 in the first nine months of 2026 from $1.98 a year earlier.
Most of the drop came from charges. In the first nine months of 2026, Edwards took a $220 million write-down of a research and development asset, $164 million of impairment losses on investments in other medical device companies, and a $174 million tax charge after California limited the use of research tax credits, partly offset by gains on investments. Earnings were also weak in the fourth quarter of 2025, at $91 million. Management said on the November 4, 2026 call that the write-down was the main reason third-quarter GAAP earnings per share came in at $0.53; it cut third-quarter operating income to $299 million.
The buyback program itself is modest. Net of the stock it awards employees, Edwards spent the equivalent of about 0.95% of its market value on buybacks over the past year.
Edwards Pays For The Buyback From Its Valve Business
Edwards produced $1.42 billion of free cash flow over the four quarters to September 30, 2026, and the company pays no dividend. That cash covered its $755 million of buybacks 1.9 times over.
The cash comes from a business that keeps a large part of each sale as profit. Edwards’ operating margin was 21.6% over those four quarters, against 19.0% for the S&P 500. Most of its revenue comes from Transcatheter Aortic Valve Replacement, heart valves delivered by catheter, which brought in $4.49 billion of the company’s $6.07 billion in fiscal 2025. The smaller Transcatheter Mitral and Tricuspid Therapies line grew 56.4% that year.
Edwards is not borrowing to pay for the buybacks. As of September 30, 2026, the company held $4.05 billion more in cash and short-term investments than it owed in debt, so the buyback comes out of surplus cash.
Is Edwards Spending Less On Buybacks Each Year?
Yes. Edwards spent $1.51 billion on buybacks in the four quarters to September 2024 and $953 million in the four quarters after that. The company spent even less in the latest four quarters.
The share count shrank more slowly in the latest year: it fell 1.4%, after drops of 2.1% and 1.9% in the two years before. Management expects average diluted shares for 2026 of 575 million to 580 million, against 578 million in the third quarter. Edwards still has about $1.3 billion left under its repurchase authorization, management said.
The three-year cut in the share count hides this slowdown. If buybacks keep shrinking, any rise in earnings per share has to come from profit itself. Buyers already pay 59.7 times Edwards’ earnings over the past twelve months, against 21.9 for the S&P 500, which suggests they are counting on that profit to grow.
What Would Stop Edwards’ Buyback From Paying Off?
A share count that stops shrinking while earnings per share keep falling would leave the buyback adding nothing to what each Edwards share earns. The cash side remains intact: the valve business produces far more than the buyback costs, and Edwards has more cash than debt. The weaker side is the profit behind each share, which fell over three years on reported numbers, largely because of charges, even as the count shrank.
The number to watch is Edwards’ reported earnings per share for 2026, beside its diluted share count, in the report the company is expected to release in February 2027.
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