Truist Securities has adjusted its price target for Medtronic , Inc. (NYSE: NYSE:MDT) shares, increasing it to $90.00 from the previous $85.00, while maintaining a Hold rating on the stock.
The adjustment follows Medtronic's first-quarter earnings, which surpassed revenue expectations while operating margins remained in line with forecasts. The company also delivered a slight earnings per share (EPS) beat by $0.03 compared to consensus estimates.
The management team at Medtronic has revised its revenue and EPS guidance upwards, albeit noting that foreign exchange rates are likely to have a more significant impact on revenues than on EPS due to hedging strategies in place.
The company anticipates operating margin expansion to be more pronounced in the second half of the year. Additionally, further EPS growth could be supported by increased share buybacks, as Medtronic has been actively repurchasing shares in the open market, with around $4 billion in buybacks over the past two quarters.
Truist Securities' commentary highlighted that Medtronic's results reflect an improvement in execution and a growing confidence in the company's ability to achieve mid-single-digit organic revenue growth.
In other recent news, Medtronic has seen noteworthy developments. The company's first-quarter results for fiscal year 2025 showed a 5.3% increase in revenue, surpassing expectations.
The positive performance led to an upward revision in full-year revenue and earnings per share (EPS) guidance. Medtronic's organic revenue growth and EPS exceeded Wall Street's forecasts, leading to a slight increase in its fiscal year 2025 guidance for both revenue and earnings. Piper Sandler maintained its Overweight rating on Medtronic's shares, while Goldman Sachs held its Sell rating due to ongoing growth in operating expenses and uncertainties in other income and expenses.
In contrast, Oppenheimer increased Medtronic's price target to $94 while maintaining a Perform rating, highlighting the company's improved FY25 guidance and potential growth drivers.
InvestingPro Insights
Medtronic's (NYSE:MDT) recent first-quarter earnings have caught the attention of investors and analysts alike. According to InvestingPro data, the company's market capitalization stands at a robust $112.79 billion, with a Price/Earnings (P/E) ratio of 29.49, reflecting investor confidence in its profitability. Additionally, Medtronic's revenue over the last twelve months as of Q1 2023 has grown by 3.23%, indicating a steady financial performance.
Two InvestingPro Tips provide further insights into Medtronic's financial health and strategic moves. Firstly, the company has been aggressively buying back shares, which aligns with the management's strategy mentioned in the article and can be a positive signal for investors regarding the company's valuation of its stock. Secondly, Medtronic has consistently raised its dividend for 10 consecutive years, demonstrating a commitment to returning value to shareholders. This commitment is further underscored by the fact that Medtronic has maintained dividend payments for an impressive 48 consecutive years.
For investors seeking a comprehensive analysis, there are additional InvestingPro Tips available on InvestingPro that delve into various aspects of Medtronic's performance and outlook. These tips can offer valuable perspectives for making informed investment decisions.
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