On Wednesday, Medtronic , Inc. (NYSE:MDT) saw its price target increased by Mizuho from $95.00 to $98.00. The firm maintained an Outperform rating on the medical technology company's shares. The adjustment follows Medtronic's recent performance updates, which included several key points that contributed to the optimistic outlook.
The company's cardiovascular segment outperformed expectations, primarily due to the strong adoption of PulseSelect PFA, which is anticipated to grow further pending FDA approval of Affera/Sphere-9. Additionally, Medtronic's diabetes sector continued to show strength, driven by the uptake of the 780G system and CGM (Continuous Glucose Monitoring) products.
However, Medtronic's MedSurg division faced challenges, reporting lower results due to tough comparison from the previous year and the impact of a strike in Korea. Despite these headwinds, the company's TAVR (Transcatheter Aortic Valve Replacement) business is growing at a high single-digit rate, aligning with market trends. The limited market release of the Evolut FX+ since July is expected to further boost TAVR growth.
The company is also experiencing a margin-expansion narrative, although foreign exchange fluctuations and inflation have delayed the impact on the bottom line. The firm's outlook remains positive as it believes Medtronic's strategic moves are progressively contributing to its success. The analyst from Mizuho concluded that all the pieces continue to fall into place for Medtronic, endorsing a sustained Outperform rating.
In other recent news, Medtronic Inc (NYSE:MDT). reported a 5.3% increase in revenue for the first quarter of fiscal 2025, surpassing expectations. The company's highest-grossing businesses saw an 8% growth, leading to a raise in full-year revenue and EPS guidance. Amidst this financial growth, Medtronic announced a global partnership with Abbott and appointed Gary Corona as the Interim CFO.
Analysts have reacted to these developments with varying perspectives. Baird raised Medtronic's price target to $90, maintaining a Neutral rating. Wells Fargo (NYSE:WFC) kept its Overweight rating on the stock, highlighting strong first-quarter revenue. However, Wolfe Research maintained its Underperform rating citing competitive pressures and Deutsche Bank (ETR:DBKGn) kept its Hold rating, noting the need for a more substantial beat and raise pattern for momentum. These are among the recent developments for Medtronic Inc.
InvestingPro Insights
Following Mizuho's upgrade of Medtronic's price target, InvestingPro data underscores the company's robust financial health. With a market capitalization of $109.51 billion and a P/E ratio that has adjusted to 22.94 from the last twelve months as of Q4 2024, Medtronic demonstrates stability and growth potential. The company's revenue growth of 3.64% over the same period, coupled with a high gross profit margin of 65.73%, reflects its efficient operations and strong market position.
InvestingPro Tips highlight that Medtronic has been consistently rewarding shareholders, raising its dividend for 10 consecutive years and maintaining dividend payments for 48 consecutive years—a testament to its financial resilience and commitment to shareholder returns. Moreover, the stock's low price volatility and its status as a prominent player in the Healthcare Equipment & Supplies industry are key factors that may appeal to investors seeking a stable investment with growth prospects. For those interested in deeper analysis, there are additional InvestingPro Tips available on Medtronic at https://www.investing.com/pro/MDT.
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