Medtronic plc (MDT) is a top global healthcare firm. It develops new medical devices and treatments to improve the health of people with long-term illnesses. Based in Galway, Ireland, it works in heart care, diabetes, brain treatments, and more, helping millions with its helpful tech. The company has a market capitalization of $124.03 billion, which classifies it as a “large-cap” stock.
Medtronic’s shares reached a 52-week high of $106.33 on Nov. 26, but are down 9.1% from that level. Earnings pressure stemming from margin contraction has led to a drop in the stock’s trajectory. Over the past three months, Medtronic’s stock has declined 8.3%. On the other hand, the broader S&P 500 Index ($SPX) has gained 2.7% over the same period.
Over a more extended period, this underperformance persists. Over the past 52 weeks, the stock has been up 6.8%, while the S&P 500 Index has increased 16.6%. This year, the stock has gained marginally, underperforming the broader index’s 1.5% gains. Medtronic’s shares have been trading above their 200-day moving average since last year but below their 50-day moving average since mid-February.
After announcing the spinout of its diabetes business less than a year ago, Medtronic is planning the IPO of that business. The company is now seeking to raise $784 million in an IPO for the MiniMed segment. The move comes as Medtronic tries to simplify its business portfolio. Those efforts also featured forming the kidney care-focused Mozarc Medical joint venture in 2023, followed by exiting the ventilator business the next year.
On Feb. 17, Medtronic announced better-than-expected third-quarter results for fiscal 2026 (quarter ended Jan. 23). The company’s revenue increased 8.7% year-over-year (YOY) to $9.02 billion, with organic revenue increasing by 6% YOY. However, its non-GAAP EPS dropped from $1.39 to $1.36. Medtronic’s stock dropped 3.1% intraday on Feb. 17. Nevertheless, Wall Street analysts expect its EPS to increase 3.1% annually to $1.67 for the current quarter.
We compare Medtronic’s performance with that of another popular medical device stock, Abbott Laboratories (ABT), which has declined 15.5% over the past 52 weeks and 8.4% YTD. Therefore, Medtronic has been the clear outperformer over these periods.
Wall Street analysts are moderately bullish on Medtronic’s stock. The stock has a consensus rating of “Moderate Buy” from the 29 analysts covering it. The mean price target of $111.42 implies a 15.3% upside from current levels. The Street-high price target of $125 indicates a 29.3% upside.
On the date of publication, Anushka Dutta did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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