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Is it Apt to Retain Medtronic Stock in Your Portfolio Now?
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Key Takeaways
Medtronic is targeting high-growth markets, with cardiac ablation sales surging 88% worldwide.
MDT's hypertension growth gains support from better reimbursement, clinical evidence and hospital adoption.
MDT expands MedSurg growth through Hugo robotics and Touch Surgery amid tariff and currency pressures.
Medtronic plc (MDT - Free Report) is expanding its presence in high-growth markets, including cardiac ablation, robotics and structural heart, while advancing the MiniMed separation. Hypertension is a growing focus for the company, aided by improved reimbursement, clinical evidence, hospital adoption and workflow integration. MedSurg growth is supported by robotics, digital surgery and core procedural technologies, with Hugo and Touch Surgery expanding adoption. Meanwhile, Medtronic faces tariff, inflation, product-mix and currency risks that could pressure margins.
Over the past year, this Zacks Rank #3 (Hold) stock has risen 0.1% against the industry’s 26.6% fall and the S&P 500 composite’s 16.6% jump.
The renowned medical device company has a market capitalization of $120.53 billion. Medtronic has an earnings yield of 6.4% compared with the industry’s yield of 2.7%. MDT’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 2.76%.
Let’s delve deeper.
Tailwinds for MDT
Strategic Focus to Capture Several Growth Markets: Medtronic is expanding in cardiac ablation, neuromodulation, diabetes technologies, surgical robotics and other faster-growing adjacencies. This approach lets the company concentrate investment in categories where differentiated innovation can support multi-year growth. In the first quarter of fiscal 2027, organic revenues rose 13.7%, including an estimated 670-basis-point (bps) benefit from the extra selling week. Excluding that benefit, management said the quarter delivered its best performance in nearly eight years outside pandemic-related comparisons. CAS remained the clearest growth driver, increasing 88% worldwide as Affera and Sphere-9 adoption expanded.
Medtronic also completed the Scientia Vascular and SPR Therapeutics acquisitions, which are expected to contribute more than $150 million of inorganic fiscal 2027 revenues. Both operate in markets with annual growth rates above 20%, increasing exposure to faster-growing categories. Strategic investments in Cornerstone Robotics and Pi-Cardia expand Medtronic’s exposure to robotics and structural heart, while the MiniMed separation remains on track for completion before fiscal year-end.
Image Source: Zacks Investment Research
Hypertension, A New Focus Area: Medtronic’s Hypertension business is building the Symplicity Spyral renal denervation franchise as reimbursement, clinical evidence and workflow integration improve. Procedure momentum increased following the final Medicare National Coverage Determination. At the end of fiscal 2026, average weekly procedures doubled after the decision, while the franchise annualized at about $100 million. In the first quarter of fiscal 2027, management cited progress in access, market development and adoption, with more hospitals approaching Medtronic about establishing programs.
The SPYRAL AFFIRM clinical trial was accepted as a late-breaker for TCT in fall 2026, extending the evidence base. The company also expects to launch a transradial catheter in the second half of fiscal 2027, which should make the therapy easier to integrate into established interventional workflows.
MedSurg Growth Prospects Remain Favorable: Medical Surgical is benefiting from broader adoption of robotics, digital surgery and core procedural technologies. First-quarter fiscal 2027 revenues increased 10.2% organically compared with 2.9% growth in fiscal 2026. Surgical & Endoscopy rose 9%, supported by Advanced Energy, Wound Management, Endoscopy and a larger Hugo contribution. Management expects Hugo to exceed 50,000 completed procedures by fiscal 2027 year-end, with procedure growth running at more than twice the market rate.
Touch Surgery is now used in more than 1,500 operating rooms globally, while FDA clearance for Touch Surgery Aide expands the digital surgery platform. The Cornerstone Robotics agreement broadens Medtronic’s robotics offering and is expected to contribute to growth and margins beginning in fiscal 2028.
Downsides for MDT
Macroeconomic and Margin Risks Persist: Medtronic remains exposed to changing global trade policies, inflation and geopolitical disruption, which can raise operating costs and complicate margin recovery. Tariffs were only a slight drag in first-quarter fiscal 2027 as payments were largely offset by refunds, but the benefit may not persist as trade policies evolve. Product mix also remained unfavorable by 50 bps, mainly due to Diabetes and CAS. Pricing and cost of goods sold (COGS) efficiency provided offsets during the quarter, yet continued investment in commercialization and portfolio expansion could absorb part of those gains.
Exposure to Currency Movement: Medtronic’s large international presence leaves reported results sensitive to exchange rates. Fiscal 2027 guidance now assumes a $50 million to $150 million revenue drag from foreign exchange, while the EPS impact is expected to be neutral to a 1% benefit.
MDT Stock Estimate Trend
The Zacks Consensus Estimate for Medtronic’s fiscal 2027 earnings per share (EPS) has increased 1 cent to $5.98 in the past 30 days.
The consensus estimate for fiscal 2027 revenues is pegged at $38.97 billion, implying a 7.2% rise from the year-ago reported number.
Phibro Animal Health has an earnings yield of 9.3% compared with the industry’s 2.7%. Shares of the company have dropped 3.1% compared with the industry’s 26.6% decline over the past year. PAHC’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 18.4%.
Abbott, carrying a Zacks Rank #2 (Buy), has an earnings yield of 5.6% compared with the industry’s 2.6% yield. Its earnings beat estimates in each of the trailing four quarters, the average surprise being 0.8%. ABT shares have plunged 19.1% compared with the industry’s 26.5% decline over the past year.
Globus Medical, carrying a Zacks Rank #2, has an earnings yield of 6.8% against the industry’s negative 1.7% yield. Its earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 27.9%. GMED shares have rallied 35.1% compared with the industry’s 7.8% growth over the past year.
View the Zacks #1 Rank List
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Is it Apt to Retain Medtronic Stock in Your Portfolio Now?
Key Takeaways
Medtronic plc (MDT - Free Report) is expanding its presence in high-growth markets, including cardiac ablation, robotics and structural heart, while advancing the MiniMed separation. Hypertension is a growing focus for the company, aided by improved reimbursement, clinical evidence, hospital adoption and workflow integration. MedSurg growth is supported by robotics, digital surgery and core procedural technologies, with Hugo and Touch Surgery expanding adoption. Meanwhile, Medtronic faces tariff, inflation, product-mix and currency risks that could pressure margins.
Over the past year, this Zacks Rank #3 (Hold) stock has risen 0.1% against the industry’s 26.6% fall and the S&P 500 composite’s 16.6% jump.
The renowned medical device company has a market capitalization of $120.53 billion. Medtronic has an earnings yield of 6.4% compared with the industry’s yield of 2.7%. MDT’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 2.76%.
Let’s delve deeper.
Tailwinds for MDT
Strategic Focus to Capture Several Growth Markets: Medtronic is expanding in cardiac ablation, neuromodulation, diabetes technologies, surgical robotics and other faster-growing adjacencies. This approach lets the company concentrate investment in categories where differentiated innovation can support multi-year growth. In the first quarter of fiscal 2027, organic revenues rose 13.7%, including an estimated 670-basis-point (bps) benefit from the extra selling week. Excluding that benefit, management said the quarter delivered its best performance in nearly eight years outside pandemic-related comparisons. CAS remained the clearest growth driver, increasing 88% worldwide as Affera and Sphere-9 adoption expanded.
Medtronic also completed the Scientia Vascular and SPR Therapeutics acquisitions, which are expected to contribute more than $150 million of inorganic fiscal 2027 revenues. Both operate in markets with annual growth rates above 20%, increasing exposure to faster-growing categories. Strategic investments in Cornerstone Robotics and Pi-Cardia expand Medtronic’s exposure to robotics and structural heart, while the MiniMed separation remains on track for completion before fiscal year-end.
Image Source: Zacks Investment Research
Hypertension, A New Focus Area: Medtronic’s Hypertension business is building the Symplicity Spyral renal denervation franchise as reimbursement, clinical evidence and workflow integration improve. Procedure momentum increased following the final Medicare National Coverage Determination. At the end of fiscal 2026, average weekly procedures doubled after the decision, while the franchise annualized at about $100 million. In the first quarter of fiscal 2027, management cited progress in access, market development and adoption, with more hospitals approaching Medtronic about establishing programs.
The SPYRAL AFFIRM clinical trial was accepted as a late-breaker for TCT in fall 2026, extending the evidence base. The company also expects to launch a transradial catheter in the second half of fiscal 2027, which should make the therapy easier to integrate into established interventional workflows.
MedSurg Growth Prospects Remain Favorable: Medical Surgical is benefiting from broader adoption of robotics, digital surgery and core procedural technologies. First-quarter fiscal 2027 revenues increased 10.2% organically compared with 2.9% growth in fiscal 2026. Surgical & Endoscopy rose 9%, supported by Advanced Energy, Wound Management, Endoscopy and a larger Hugo contribution. Management expects Hugo to exceed 50,000 completed procedures by fiscal 2027 year-end, with procedure growth running at more than twice the market rate.
Touch Surgery is now used in more than 1,500 operating rooms globally, while FDA clearance for Touch Surgery Aide expands the digital surgery platform. The Cornerstone Robotics agreement broadens Medtronic’s robotics offering and is expected to contribute to growth and margins beginning in fiscal 2028.
Downsides for MDT
Macroeconomic and Margin Risks Persist: Medtronic remains exposed to changing global trade policies, inflation and geopolitical disruption, which can raise operating costs and complicate margin recovery. Tariffs were only a slight drag in first-quarter fiscal 2027 as payments were largely offset by refunds, but the benefit may not persist as trade policies evolve. Product mix also remained unfavorable by 50 bps, mainly due to Diabetes and CAS. Pricing and cost of goods sold (COGS) efficiency provided offsets during the quarter, yet continued investment in commercialization and portfolio expansion could absorb part of those gains.
Exposure to Currency Movement: Medtronic’s large international presence leaves reported results sensitive to exchange rates. Fiscal 2027 guidance now assumes a $50 million to $150 million revenue drag from foreign exchange, while the EPS impact is expected to be neutral to a 1% benefit.
MDT Stock Estimate Trend
The Zacks Consensus Estimate for Medtronic’s fiscal 2027 earnings per share (EPS) has increased 1 cent to $5.98 in the past 30 days.
The consensus estimate for fiscal 2027 revenues is pegged at $38.97 billion, implying a 7.2% rise from the year-ago reported number.
Key Picks
Some better-ranked stocks in the broader medical space are Phibro Animal Health (PAHC - Free Report) , Abbott (ABT - Free Report) and Globus Medical (GMED - Free Report) .
Phibro Animal Health has an earnings yield of 9.3% compared with the industry’s 2.7%. Shares of the company have dropped 3.1% compared with the industry’s 26.6% decline over the past year. PAHC’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 18.4%.
PAHC sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Abbott, carrying a Zacks Rank #2 (Buy), has an earnings yield of 5.6% compared with the industry’s 2.6% yield. Its earnings beat estimates in each of the trailing four quarters, the average surprise being 0.8%. ABT shares have plunged 19.1% compared with the industry’s 26.5% decline over the past year.
Globus Medical, carrying a Zacks Rank #2, has an earnings yield of 6.8% against the industry’s negative 1.7% yield. Its earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 27.9%. GMED shares have rallied 35.1% compared with the industry’s 7.8% growth over the past year.