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Medtronic (MDT) Falls More Steeply Than Broader Market: What Investors Need to Know

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The most recent trading session ended with Medtronic (MDT - Free Report) standing at $86.97, reflecting a -0.54% shift from the previouse trading day's closing. The stock's change was less than the S&P 500's daily loss of 0.06%. At the same time, the Dow added 0.35%, and the tech-heavy Nasdaq lost 0.76%.

The the stock of medical device company has risen by 6.14% in the past month, leading the Medical sector's gain of 1.65% and the S&P 500's gain of 3.36%.

Investors will be eagerly watching for the performance of Medtronic in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on February 20, 2024. On that day, Medtronic is projected to report earnings of $1.26 per share, which would represent a year-over-year decline of 3.08%. Alongside, our most recent consensus estimate is anticipating revenue of $7.95 billion, indicating a 2.91% upward movement from the same quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $5.16 per share and revenue of $32.07 billion, indicating changes of -2.46% and +2.71%, respectively, compared to the previous year.

Investors should also take note of any recent adjustments to analyst estimates for Medtronic. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. As of now, Medtronic holds a Zacks Rank of #4 (Sell).

With respect to valuation, Medtronic is currently being traded at a Forward P/E ratio of 16.93. Its industry sports an average Forward P/E of 20.93, so one might conclude that Medtronic is trading at a discount comparatively.

It is also worth noting that MDT currently has a PEG ratio of 3.06. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Medical - Products industry stood at 2.5 at the close of the market yesterday.

The Medical - Products industry is part of the Medical sector. Currently, this industry holds a Zacks Industry Rank of 170, positioning it in the bottom 33% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


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