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Medtronic (MDT) Gains As Market Dips: What You Should Know

Zacks Equity Research

Medtronic (MDT) closed at $107.97 in the latest trading session, marking a +0.88% move from the prior day. This move outpaced the S&P 500's daily loss of 0.2%. At the same time, the Dow added 0.04%, and the tech-heavy Nasdaq lost 0.13%.

Coming into today, shares of the medical device company had lost 0.36% in the past month. In that same time, the Medical sector gained 8.04%, while the S&P 500 gained 7.08%.

Wall Street will be looking for positivity from MDT as it approaches its next earnings report date. This is expected to be November 19, 2019. In that report, analysts expect MDT to post earnings of $1.28 per share. This would mark year-over-year growth of 4.92%. Meanwhile, our latest consensus estimate is calling for revenue of $7.68 billion, up 2.62% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.56 per share and revenue of $31.50 billion, which would represent changes of +6.51% and +3.09%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for MDT. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. MDT is currently a Zacks Rank #3 (Hold).

Digging into valuation, MDT currently has a Forward P/E ratio of 19.25. Its industry sports an average Forward P/E of 25.05, so we one might conclude that MDT is trading at a discount comparatively.

Investors should also note that MDT has a PEG ratio of 2.63 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. MDT's industry had an average PEG ratio of 2.46 as of yesterday's close.

The Medical - Products industry is part of the Medical sector. This group has a Zacks Industry Rank of 104, putting it in the top 41% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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