Medtronic narrows guidance on tax credit

MINNEAPOLIS (AP) -- Medtronic Inc. narrowed its earnings guidance for its 2013 fiscal year Monday following the renewal of a key tax credit.

The Minneapolis-based medical-equipment maker said it expects to earn $3.66 to $3.70 per share. Its prior guidance was for $3.62 to $3.70 per share. Analysts polled by FactSet were expecting the company to earn $3.65 per share for the year.

Medtronic said that the new guidance is based on the beneficial impact from the renewal of the U.S. Research and Development tax credit. The company estimates the credit adds 4 cents per share to its full-year earnings, of which about 3 cents will be recognized in its third quarter and 1 cent in its fourth quarter.

The credit was approved as part of the Congressional "fiscal cliff" agreement that was signed by President Barack Obama last week. The tax credit for research and development, one of the biggest in the compromise package, is intended to support development and manufacturing to help U.S. companies against foreign competition.

Medtronic's shares were up 53 cents to $43.19 in late trading. Its stock is nearing the high end of its 52-week trading range of $35.67 to $44.79.