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

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In the latest trading session, Medtronic (MDT - Free Report) closed at $101.39, marking a +0.15% move from the previous day. This move outpaced the S&P 500's daily gain of 0.08%. At the same time, the Dow lost 0.09%, and the tech-heavy Nasdaq gained 0.38%.

Heading into today, shares of the medical device company had gained 2.84% over the past month, outpacing the Medical sector's loss of 3.76% and the S&P 500's loss of 3.57% in that time.

MDT will be looking to display strength as it nears its next earnings release, which is expected to be August 20, 2019. On that day, MDT is projected to report earnings of $1.18 per share, which would represent year-over-year growth of 0.85%. Meanwhile, our latest consensus estimate is calling for revenue of $7.41 billion, up 0.41% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.46 per share and revenue of $31.44 billion. These totals would mark changes of +4.6% and +2.9%, respectively, from last year.

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. As a result, we can interpret positive estimate revisions as a good sign for 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.

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 has moved 0.33% higher. MDT is holding a Zacks Rank of #2 (Buy) right now.

Digging into valuation, MDT currently has a Forward P/E ratio of 18.53. Its industry sports an average Forward P/E of 27.75, so we one might conclude that MDT is trading at a discount comparatively.

Meanwhile, MDT's PEG ratio is currently 2.6. 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 Medical - Products industry currently had an average PEG ratio of 2.54 as of yesterday's close.

The Medical - Products industry is part of the Medical sector. This group has a Zacks Industry Rank of 61, putting it in the top 24% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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