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EW, Edwards Lifesciences Corporation

Medical Devices & Equipment consumer brand

Edwards Lifesciences Corporation is the leading global structural heart innovation company, driven by a passion to improve patient lives.

Edwards remains committed to its strategy of transformative product innovation, high-quality, expansive clinical evidence to support approvals and adoption, as well as comprehensive support to ensure excellent real-world patient outcomes.

Our future growth opportunities include offering solutions for treating patients with both valvular and non-valvular structural heart disease, such as heart failure, which is an unfortunate natural progression of the disease for many patients suffering from aortic stenosis, mitral and tricuspid regurgitation, and aortic regurgitation.

Latest annual: FY2025 10-K

EW · Edwards Lifesciences Corporation

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$6.1B

+11.5% YoY · 7% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $6.3B 5-yr avg $5.2B

Gross margin 78% 5-yr avg 80%

Operating margin 21.4% 5-yr avg 27.6%

ROIC 13% 5-yr avg 20%

Owner-earnings margin 19% 5-yr avg 20%

Free cash flow margin 17% 5-yr avg 18%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is Transcatheter Aortic Valve Replacement (74%), Surgical Structural Heart (17%) and Transcatheter Mitral and Tricuspid Therapies (9%).
What moves the needle: Gross margin has run about 75% and operating margin about 25% through the cycle, a wide spread between price and the cost of what it sells — whether that advantage is durable pricing power or a margin that can erode is the question the record is for. Inventory runs near 16% of sales, so how fast it turns back into cash — and the risk of writing it down when demand softens — sits alongside the margin. Read this kind of business on the installed base and what follows it. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has run high across the record (median 22%, above 15% in 9 of 10 years). Owner earnings agree: roughly 23% of revenue reaches owners as cash, consistently. Whether these returns reflect real pricing power or an accounting artifact is the judgment the 10-K is for.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

Transcatheter Aortic Valve Replacement is 74% of revenue, with Surgical Structural Heart the other meaningful line at 17%.

Revenue by product line, FY2025

Transcatheter Aortic Valve Replacement74%$4.5B
Surgical Structural Heart17%$1.0B
Transcatheter Mitral and Tricuspid Therapies9%$551M

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$3.0B	$3.4B	$3.7B	$4.3B	$4.4B	$5.2B	$4.5B	$5.0B	$5.4B	$6.1B	$6.3B	RevenueRevenue
73%	75%	75%	74%	75%	76%	84%	80%	79%	78%	78%	Gross marginGross mgn
31%	29%	29%	29%	28%	29%	30%	32%	33%	34%	34%	SG&A / revenueSG&A/rev
15%	16%	17%	17%	17%	17%	19%	19%	19%	18%	17%	R&D / revenueR&D/rev
$751M	$1.1B	$748M	$1.1B	$898M	$1.7B	$1.5B	$1.3B	$1.4B	$1.3B	$1.3B	Operating incomeOp. inc.
25.3%	31.7%	20.1%	26.4%	20.5%	32.3%	33.6%	26.1%	25.3%	20.8%	21.4%	Operating marginOp. mgn
$570M	$584M	$722M	$1.0B	$823M	$1.5B	$1.5B	$1.4B	$4.2B	$1.1B	$1.1B	Net incomeNet inc.
23%	44%	5%	10%	10%	12%	11%	10%	4%	17%	17%	Effective tax rateTax rate
											Cash flow & returns
$704M	$1.0B	$927M	$1.2B	$1.1B	$1.7B	$1.2B	$896M	$542M	$1.6B	$1.4B	Operating cash flowOp. cash
$71M	$82M	$77M	$89M	$107M	$135M	$140M	$145M	$155M	$157M	$161M	DepreciationDeprec.
$7M	$274M	$56M	($35M)	$31M	($15M)	($570M)	($791M)	($3.9B)	$207M	($62M)	Working capital & otherWC & other
$176M	$168M	$239M	$254M	$407M	$326M	$245M	$253M	$252M	$260M	$269M	CapexCapex
5.9%	4.9%	6.4%	5.9%	9.3%	6.2%	5.5%	5.0%	4.6%	4.3%	4.3%	Capex / revenueCapex/rev
$633M	$919M	$849M	$1.1B	$947M	$1.6B	$1.1B	$751M	$387M	$1.4B	$1.2B	Owner earningsOwner earn.
21.4%	26.7%	22.8%	25.2%	21.6%	30.5%	24.2%	15.0%	7.1%	23.7%	19.0%	Owner earnings marginOE mgn
$528M	$833M	$688M	$929M	$647M	$1.4B	$974M	$643M	$290M	$1.3B	$1.1B	Free cash flowFCF
17.8%	24.2%	18.5%	21.4%	14.8%	26.9%	21.8%	12.8%	5.3%	22.0%	17.3%	Free cash flow marginFCF mgn
$0	$193M	$0	$100M	$0	$0	—	—	—	—	$0	AcquisitionsAcquis.
$662M	$763M	$796M	$263M	$625M	$513M	$1.7B	$880M	$1.2B	$893M	—	BuybacksBuybacks
23%	19%	23%	29%	20%	27%	24%	19%	18%	13%	13%	ROICROIC
22%	20%	23%	25%	18%	26%	26%	21%	42%	10%	11%	Return on equityROE
22%	20%	23%	25%	18%	26%	26%	21%	42%	10%	11%	Retained to equityRetained/eq
											Balance sheet
$1.3B	$1.3B	$957M	$1.5B	$1.4B	$1.5B	$1.2B	$1.6B	$4.0B	$4.2B	$3.7B	Cash & investmentsCash+inv
$366M	$439M	$457M	$544M	$515M	$582M	$643M	$772M	$609M	$660M	$776M	ReceivablesReceiv.
$397M	$555M	$607M	$641M	$802M	$727M	$876M	$904M	$1.1B	$1.1B	$1.1B	InventoryInvent.
$97M	$117M	$134M	$180M	$197M	$205M	$202M	$187M	$197M	$228M	$181M	Accounts payablePayables
$665M	$877M	$930M	$1.0B	$1.1B	$1.1B	$1.3B	$1.5B	$1.5B	$1.6B	$1.7B	Operating working capitalOper. WC
$2.2B	$2.5B	$2.3B	$3.0B	$3.1B	$3.2B	$3.1B	$4.0B	$6.3B	$6.7B	$6.2B	Current assetsCur. assets
$533M	$1.4B	$877M	$902M	$894M	$1.0B	$1.0B	$1.2B	$1.5B	$1.8B	$1.4B	Current liabilitiesCur. liab.
4.2×	1.8×	2.6×	3.3×	3.5×	3.1×	3.0×	3.4×	4.2×	3.7×	4.4×	Current ratioCurr. ratio
$626M	$1.1B	$1.1B	$1.2B	$1.2B	$1.2B	$1.1B	$1.1B	$1.8B	$1.8B	$1.8B	GoodwillGoodwill
$4.5B	$5.7B	$5.3B	$6.5B	$7.2B	$8.5B	$8.3B	$9.4B	$13.1B	$13.7B	$13.3B	Total assetsAssets
$822M	$1.0B	$594M	$594M	$595M	$596M	$596M	$597M	$598M	$598M	$599M	Total debtDebt
($449M)	($301M)	($363M)	($923M)	($808M)	($871M)	($619M)	($1.0B)	($3.4B)	($3.6B)	($3.1B)	Net debt / (cash)Net debt
39.1×	47.0×	25.0×	55.4×	56.8×	91.9×	78.0×	74.4×	69.6×	62.0×	66.0×	Interest coverageInt. cov.
$2.6B	$3.0B	$3.1B	$4.1B	$4.6B	$5.8B	$5.8B	$6.7B	$10.0B	$10.3B	$10.3B	Shareholders’ equityEquity
1.9%	1.8%	1.9%	1.9%	2.1%	2.1%	2.8%	2.8%	3.0%	2.6%	2.6%	Stock comp / revenueSBC/rev
											Per share
653M	648M	641M	637M	632M	631M	624M	609M	599M	586M	581M	Shares out (diluted)Shares
$4.54	$5.30	$5.81	$6.83	$6.94	$8.29	$7.15	$8.22	$9.08	$10.36	$10.86	Revenue / shareRev/sh
$0.87	$0.90	$1.13	$1.64	$1.30	$2.38	$2.44	$2.30	$6.97	$1.83	$1.89	EPS (diluted)EPS
$0.97	$1.42	$1.33	$1.72	$1.50	$2.53	$1.73	$1.23	$0.65	$2.46	$2.06	Owner earnings / shareOE/sh
$0.81	$1.29	$1.07	$1.46	$1.02	$2.23	$1.56	$1.05	$0.48	$2.28	$1.88	Free cash flow / shareFCF/sh
$0.27	$0.26	$0.37	$0.40	$0.64	$0.52	$0.39	$0.42	$0.42	$0.44	$0.46	Cap. spending / shareCapex/sh
$4.01	$4.56	$4.90	$6.52	$7.24	$9.25	$9.30	$10.91	$16.68	$17.65	$17.78	Book value / shareBVPS

Share counts before 2018 are restated ×3 for a stock split, so per-share figures sit on one basis.

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+9.6%/yr	+8.3%/yr
Owner earnings / share	+10.9%/yr	+10.4%/yr
EPS	+8.6%/yr	+7.1%/yr
Capital spending / share	+5.7%/yr	−7.2%/yr
Book value / share	+17.9%/yr	+19.5%/yr

The year, in the company's words

the filing →

Verbatim from the 10-K's management discussion. Each sentence is shown only because its subject, direction check out against the filed numbers on this page. The words are the company's; the arithmetic is the record's.

Transcatheter Mitral and Tricuspid Therapies+56.4%
“Transcatheter Mitral and Tricuspid Therapies The increase in net sales in 2025 of TMTT products was primarily due to higher sales of our PASCAL transcatheter edge-to-edge repair system and EVOQUE tricuspid valve replacement system in the United States and Europe.”
✓ direction matches the filed record

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked. Share counts on the current split basis.

Share count

586Mpeak FY2016

ROIC

13%low FY2025

Gross margin

78%low FY2016

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$1.4Bowner earningsvs.$1.1Bnet incomelow FY2024

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business earned $1.4B of owner earnings, the operating cash left after the $157M it takes just to hold its position. It put $104M more into growth; free cash flow, after that spending, was $1.3B.

Reported net income$1.1B

Owner earnings$1.4B · 24% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$1.1B	$4.2B	$1.4B	$1.5B	$1.5B
Depreciation & amortizationnon-cash charge added back	+$157M	+$155M	+$145M	+$140M	+$135M
Stock-based compensationreal costnon-cash, but a real cost	+$158M	+$162M	+$139M	+$127M	+$109M
Working capital & othertiming of cash in and out, other non-cash items	+$207M	−$3.9B	−$791M	−$570M	−$15M
Cash from operations	$1.6B	$542M	$896M	$1.2B	$1.7B
Maintenance capital expenditurethe spending needed just to hold position and volume	−$157M	−$155M	−$145M	−$140M	−$135M
Owner earnings	$1.4B	$387M	$751M	$1.1B	$1.6B
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	−$104M	−$97M	−$108M	−$105M	−$191M
Free cash flow	$1.3B	$290M	$643M	$974M	$1.4B
Owner-earnings marginowner earnings ÷ revenue	24%	7%	15%	24%	31%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $157M, roughly its depreciation, the rate its assets wear out). The other $104M of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows. The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $158M), owner earnings is nearer $1.3B.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 62.0×

Comfortable

Operating income $1.3B ÷ interest expense $20M

What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
How heavy is the debt, net of cash? +$3.6B

Net cash

Cash $2.9B + ST investments $1.3B − debt $598M

What this means
Cash and short-term investments exceed every dollar of debt by $3.6B, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 286d

Long (60+ days)

DSO 40 + DIO 308 − DPO 62 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 20%

High through the cycle

10-yr median, range 13%–29%; 13% latest = NOPAT $1.1B ÷ invested capital $8.0B

Industry peers: median 13%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 13% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 23%

High through the cycle

10-yr median margin, range 7%–31%; latest $1.4B = operating cash $1.6B − maintenance capex $157M

Industry peers: median 19%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 24% of revenue this year, a 23% median across 10 years. Treating stock comp as the real expense it is (less $158M of SBC) leaves $1.3B.
Are earnings backed by cash? 1.49×

Cash-backed

Cash from ops $1.6B ÷ net income $1.1B

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 62%

Returns about half

Dividends + buybacks $893M ÷ Owner Earnings $1.4B

What this means
Of $1.4B Owner Earnings, $893M (62%) went back to shareholders, $0 dividends, $893M buybacks. Net of $158M stock comp, the real buyback was about $735M. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 1.66×

Expanding

Capex $260M ÷ depreciation $157M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 5 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $6.1B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 3.72×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $598M vs $4.9B WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Pass

A profit every year (10-yr record) · no losses

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Pass

Earnings +33% over the record · +255%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $3.85/share (latest year $1.86), the averaged base the calculator's gate runs on, and book value is $17.95/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 10 of 10

What this means
Never lost money over the record, the earnings stability Graham insisted on.
Return on capital ≥ 15% 9 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 26% → 24% (3-yr avg ends)

In the filing’s words The filing attributes gains to higher prices, but the margin in the record has not followed — the claim outruns the result here.

What this means
Through the cycle the operating margin held roughly steady — about 26% early, 24% lately, median 25%.
Reinvestment, incremental ROIC 13%

What this means
Reinvested capital came back at only a modest incremental return — near the cost of capital, where extra growth adds little per dollar. The record shows whether it is a soft stretch or a thinning moat.
Owner earnings growth +2%/yr

What this means
Owner earnings grew about 2% a year over the record.
Worst year 2018 · 20.1% op. margin

What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
How management talks about it Promotional

What this means
Results have held roughly flat while the filing leans on a promoter’s vocabulary — watch whether the words are doing work the numbers are not.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing A competitive risk, new this year

Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“Another risk may arise if we are unable to timely utilize AI for technological innovation and business operation efficiency in a manner that is faster and more effective than our competitors.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$6.2B

Cash & short-term investments$3.7B
Receivables$776M
Inventory$1.1B
Other current assets$663M

Current liabilities$1.4B

Accounts payable$181M
Other current liabilities$1.2B

Current ratio4.42×all current assets ÷ what's due · Graham looked for 2×

Quick ratio3.63×stricter: inventory excluded

Cash ratio2.61×strictest: cash alone against what's due

Working capital$4.8Bthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+16.7%the freshest read on whether the business is still growing

Current ratio, recent quarters3.7× → 4.4×

Deeper floors

Tangible book value$7.3Bequity stripped of goodwill & intangibles

Net current asset value$3.2BGraham's net-net: current assets less all liabilities

Debt incl. operating leases$703M$104M of it operating leases

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $10.9B of operating cash; how management split it reads as a cash returner, paying most of what it earns straight back to owners.

Reinvested$2.6B · 24%
Buybacks$8.3B · 76%

Returned to owners$8.3B
85% of the owner earnings the business produced over the span, $0 as dividends and $8.3B as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span debt fell $224M and cash and short-term investments rose $2.4B.
Average price paid for buybacks—
Buybacks ran $8.3B over the span, but the filings don't tag the share count needed to deduce the average price paid.
Net change in share count−11.1%
The diluted count fell from 653M to 581M, so the buybacks outran the stock issued to staff.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.
Return on what it retained1%
Of the earnings it kept rather than paid out ($5.1B over the span), annual owner earnings (first three years vs last three) grew $58M, so each retained $1 added about 0.01 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$2.9B21% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity17%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$293Mover 10 years buying other businesses, against $2.6B of capital spent building

None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Pay, as filed	“Actually paid”	Owner earnings
2021	$13.6M	$31.5M	$1.6B
2022	$14.0M	−$10.5M	$1.1B
2023	$1.8M	−$4.1M	$751M
2023	$12.9M	$11.0M	$751M
2024	$14.6M	$9.2M	$387M
2025	$17.5M	$21.3M	$1.4B

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership0.3%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
Stock-based compensation$158M
The slice of the business handed to employees in shares this year, 3% of revenue, equal to 13% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Edwards Lifesciences Corporation is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

1 of the 6 tests turned up something to look into; the other 5 came back clean.

Look hereDid reported profit become cash?0.81×
Across the record the business reported $13.4B of net income but generated $10.9B of operating cash, a 0.81-to-one conversion. Profit that does not turn into cash over many years is the classic mark of earnings that are softer than they look. Ask where the gap sits, receivables, inventory, or costs being capitalized rather than expensed.

And these came back clean

Is it less profitable than it was?
Did the share count rise anyway?
Did debt outgrow the business?
Did receivables and inventory outpace sales?
Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Acquisitions, Contingencies as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Medical Devices & Equipment

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
ISRGIntuitive Surgical Inc.	$10.1B	68%	30.0%	16%	29%
ZBHZimmer Biomet Holdings Inc.	$8.2B	71%	11.7%	4%	18%
EWEdwards Lifesciences Corporation	$6.1B	76%	25.7%	22%	23%
RMDResMed Inc.	$5.1B	57%	27.1%	17%	19%
DXCMDexCom Inc.	$4.7B	65%	12.1%	10%	17%
HOLXHologic	$4.1B	66%	20.6%	13%	24%
ALGNAlign Technology	$4.0B	72%	19.9%	23%	22%
XRAYDENTSPLY SIRONA Inc.	$3.7B	53%	-11.5%	-6%	9%
Group median	—	67%	20.3%	14%	21%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Edwards Lifesciences Corporation has delivered.

Today’s price $

Through the cycle, Edwards Lifesciences Corporation earns about $1.4B on its 23.3% median owner-earnings margin. This year’s 23.7% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($1.4B) Net of stock comp (−$163M) Steady-state · maintenance capex ($1.2B)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25−9%/yr

Owner-earnings growth · ’16→’25+2%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $1.1B on 576M shares outstanding, per the 10-Q cover, as of 2026-04-30; net cash $3.1B. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. Capex ($269M) runs well above depreciation ($161M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $1.2B, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh EW against another business →

Cite: Owner Scorecard, "Edwards Lifesciences Corporation (EW), the owner's record," https://ownerscorecard.com/c/EW, data as of 2026-07-09.

Manual order: ← EVTC its page in the Manual EWBC →

Industry order: ← ESTA the Medical Devices & Equipment chapter FOCL →