Medtronic exceeds revenue estimates but sees a drop in operating margin in Q2.

From Nasdaq.: 2024-11-27 23:47:07

Medtronic (NYSE: MDT) exceeded street estimates in Q2 fiscal 2025, reporting revenue of $8.4 billion and adjusted earnings of $1.26 per share. Sales growth was driven by new products like MiniMed 780G. However, adjusted operating margin fell to 24.3%. MDT stock has underperformed the S&P 500, with a forecasted valuation of $90 per share.

Despite revenue growth, Medtronic’s adjusted operating margin decreased in Q2. The company expects organic sales to rise between 4.75% and 5%, with adjusted earnings projected to be between $5.44 and $5.50 for fiscal 2025. MDT stock has lagged behind the broader market in recent years, showing only a 6% increase this year.

Medtronic’s stock performance has been lackluster compared to the S&P 500, with returns of -10% in 2021, -23% in 2022, and 10% in 2023. The Trefis High Quality Portfolio has outperformed the index each year. With MDT stock trading at 16x forward expected earnings, investors may want to wait for a potential dip for long-term gains.

In terms of returns, Medtronic saw a -4% return in November 2024, with a YTD return of 6% and a total return of 46% from 2017-2024. Comparatively, the S&P 500 had a 5% return in November 2024, a YTD return of 25%, and a total return of 167% from 2017-2024. The Trefis Reinforced Value Portfolio had a -1% return in November 2024, a YTD return of 14%, and a total return of 749% from 2017-2024.



Read more at Nasdaq.: What’s Next For Medtronic Stock?