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

Zacks Equity Research

Medtronic (MDT) closed at $98.05 in the latest trading session, marking a -0.05% move from the prior day. This change lagged the S&P 500's daily gain of 0.29%. Meanwhile, the Dow gained 0.26%, and the Nasdaq, a tech-heavy index, added 0.22%.

Heading into today, shares of the medical device company had gained 5.11% over the past month, lagging the Medical sector's gain of 7.46% and the S&P 500's gain of 7.86% in that time.

Wall Street will be looking for positivity from MDT as it approaches its next earnings report date. The company is expected to report EPS of $1.18, up 0.85% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.41 billion, up 0.41% from the year-ago period.

MDT's full-year Zacks Consensus Estimates are calling for earnings of $5.46 per share and revenue of $31.44 billion. These results would represent year-over-year changes of +4.6% and +2.9%, respectively.

Investors might also notice recent changes to analyst estimates for MDT. These recent revisions tend to reflect the evolving nature of short-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.

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. The Zacks Consensus EPS estimate has moved 0.01% higher within the past month. MDT is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note MDT's current valuation metrics, including its Forward P/E ratio of 17.98. This valuation marks a discount compared to its industry's average Forward P/E of 26.54.

We can also see that MDT currently has a PEG ratio of 2.52. 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. The Medical - Products was holding an average PEG ratio of 2.38 at yesterday's closing price.

The Medical - Products industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 93, which puts it in the top 37% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow MDT in the coming trading sessions, be sure to utilize Zacks.com.


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