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Medtronic (MDT) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Medtronic (MDT) closed the most recent trading day at $118.39, moving +1.62% from the previous trading session. This change outpaced the S&P 500's 0.67% gain on the day. Elsewhere, the Dow gained 0.74%, while the tech-heavy Nasdaq added 0.81%.

Heading into today, shares of the medical device company had gained 4.28% over the past month, outpacing the Medical sector's gain of 1.59% and the S&P 500's gain of 3.55% in that time.

Wall Street will be looking for positivity from MDT as it approaches its next earnings report date. In that report, analysts expect MDT to post earnings of $1.39 per share. This would mark year-over-year growth of 7.75%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.82 billion, up 3.62% from the year-ago period.

MDT's full-year Zacks Consensus Estimates are calling for earnings of $5.60 per share and revenue of $31.53 billion. These results would represent year-over-year changes of +7.28% and +3.18%, respectively.

It is also important to note the 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.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. MDT is holding a Zacks Rank of #2 (Buy) right now.

In terms of valuation, MDT is currently trading at a Forward P/E ratio of 20.8. This valuation marks a discount compared to its industry's average Forward P/E of 24.67.

It is also worth noting that MDT currently has a PEG ratio of 2.83. 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. Medical - Products stocks are, on average, holding a PEG ratio of 2.58 based on yesterday's closing prices.

The Medical - Products industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 104, which puts 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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