Breaking News
Get 40% Off 0
Is NVDA a 🟢 buy or 🔴 sell? Unlock Now

Medtronic Stock Keeps Ticking Forward

By MarketBeat.com (Jea Yu )Stock MarketsJul 27, 2022 01:30AM ET
www.investing.com/analysis/medtronic-stock-keeps-ticking-forward-200627679
Medtronic Stock Keeps Ticking Forward
By MarketBeat.com (Jea Yu )   |  Jul 27, 2022 01:30AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
 
MDT
+0.68%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

Medical device maker Medtronic's (NYSE:MDT) stock is trading down (-14%) for the year. Medtronic is the world’s largest medical device maker with a portfolio of glucose monitors, stents, insulin pumps, pacemakers, and catheters. It serves patients in over 150 countries. The company makes medical devices to treat chronic diseases, including cardiovascular, renal, and diabetes, along with neuroscience and medical surgical segments. Procedure volumes have returned to pre-COVID levels. The company has historically maintained stable growth through bull and bear markets as it has consistently raised its dividend for 45 years.

The company’s biggest pain point was supply chain disruption in China, being the largest contributor to the fiscal Q4 2022 shortfall. Further headwinds included raw materials shortages, inflationary, and FX impacts, which the company may partially mitigate with the launch of new products this year. The company recently received FDA approval for its UNiD Spine Analyzer v4.0 planning platform, which provides predictive models for surgeons performing lower lumbar spine surgery. It is the first company in the US to receive FDA clearance for predictive models for spine surgery.

Abbott Laboratories (NYSE:ABT) is the major competitor with its pacemakers and stents, thanks to the acquisition of rival St. James Medical. It also competes with Abbott’s blood glucose monitor FreeStyle Libre which doesn’t require a fingerstick pinpricks for a reading. Boston Scientific (NYSE:BSX) is also a fierce competitor in the medical devices segment. Medtronic has a 2.85% dividend yield and is trading at 12.5X forward earnings. The CEO stated that its robust pipeline and upcoming catalysts would result in a strong second half of the calendar year. Prudent investors seeking exposure in the medical devices segment can watch for opportunistic pullbacks in shares of Medtronic.

Q4 Fiscal 2022 Earnings Release

On May 26, 2022, Medtronic released its fiscal fourth-quarter 2022 results for the quarter ending April 2022. The company reported an earnings-per-share (EPS) profit of $1.52 excluding non-recurring items versus consensus analyst estimates for a profit of $1.56, missing estimates by ($0.04). Revenues fell (-1.2% year-over-year (YoY) to $8.09 billion, beating analyst estimates for $8.43 billion. Medtronic CEO Geoff Martha commented,

"Global supply chain and COVID-19 controls in China created acute impacts to our results in the fourth quarter. We understand the root causes, we're addressing them, and we expect them to resolve over the near-term. We remain keenly focused on delivering innovation-driven growth with a robust pipeline of technologies in fast-growing markets, and we're committed to creating strong shareholder value through strategic capital allocation and active portfolio management."

Downside Guidance

Medtronic lowered its fiscal full-year 2023 EPS of $5.53 to $5.65 versus $5.75 consensus analyst estimates. Organic growth is expected to be between 4% and 5%.

Conference Call Takeaways

CEO Martha stated that procedure volumes returned to pre-COVID levels by the end of the quarter. The two biggest contributors to the shortfall in the quarter were COVID lockdowns in China and global supply chain challenges. Raw materials shortages adversely affect its Surgical Innovations segment. Medtronic's new global structure consolidates previous fragmented operations and supplies chain functions.

More work is being done to ultimately arrive at a more resilient end-to-end global supply chain that will give the company a competitive advantage. CEO Martha believes the company will have a strong back half the year. The company will contributes its Renal Care Solutions business into a new company in partnership with DaVita (NYSE:DVA). This will bring the company up to $400 million in value when the transaction closes at the end of the 2023 calendar year. The company has conducted over 300 clinical trials and received over 200 regulatory approvals in the US, Europe, Japan, and China.

Medtronic Stock Chart.
Medtronic Stock Chart.

MDT Opportunistic Pullback Levels

Using the rifle charts on the weekly and daily time frames provides a precise view of the landscape for MDT stock. The weekly rifle chart downtrend is attempting to hold above the $87.84 Fibonacci (fib) level and trigger the weekly market structure low (MSL) buy signal above the $90.51 level. The weekly rifle chart downtrend stalled with a flattening 5-period moving average (MA) at $90.09 and a 15-period falling at $97.05. The weekly stochastic is attempting a mini pup towards the 20-band. The weekly lower Bollinger Bands (BBs) sit at $78.30. The daily rifle chart is attempting to breakout as the daily 5-period MA at $89.37 attempts to cross up through the daily 15-period MA at $89.34.

The daily 50-period MA sits at $94.28 and 200-period MA at $106.21. The daily BBs are in a compression as the upper and lower BBs are tight and flat at $92.02 and $86.89, respectively. The daily stochastic is rising through the 50-band. Prudent investors can watch for opportunistic pullbacks at the $87.84 fib, $85.12 fib, $84.13 fib, $81.66, $78.63 fib, $75.71 fib, $73.47, and the $72.13 fib level. Upside trajectories sit at the $103.55 fib level up towards the $122.97 fib level. Keep an eye on competitors' ABT and BSX stock price action to gauge sentiment.

Original Post

Medtronic Stock Keeps Ticking Forward
 

Related Articles

Medtronic Stock Keeps Ticking Forward

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email