Medtronic Plc (NYSE:MDT) March 13, 2015

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MDT-US
Implied Price
NEUTRAL
55.85 80.99
BA
A Price as of Close Mar 11 76.05 USD
B CapitalCube Median Implied Price 75.45 USD * CapitalCube Price is over trading range * CapitalCube Price is below trading range
CapitalCube Estimate Range 69.91 - 80.99 USD NA
52 Week Range 55.85 - 79.45 USD
Earnings Momentum Score
 0  100
BA
A Earnings Score (MDT) 15.07
B Earnings Score(Peer Median) 23.35
Latest Filing date October 31, 2014
Fundamental Score
 0  100
BA
A Fundamental Score (MDT) 53
B Fundamental Score(Peer Median) 54.5
Dividend Score
 0  100
BA
A Dividend Quality Score (MDT) 92
B Dividend Quality Score (Peer Median) 62.5
Dividend Yield
0.53 3.10
BA
A Dividend Yield (MDT) 1.57
B Dividend Yield (Peer Median) 1.60
Analysis
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Fundamental Analysis

Capital Investment Strategy The company is likely overinvesting in a business with only median returns.

The company is likely overinvesting in a business with only median returns.

Earnings Leverage Compared with its chosen peers, the company's annual revenues and earnings change at a slower rate, implying a lack of strategic focus and/or lack of execution success. Laggard

Laggard: Companies where the yearly Revenue and Earnings Growth are both below peer median, demonstrating both top and bottom line performance that is lagging the peers.
Compared with its chosen peers, the company's annual revenues and earnings change at a slower rate, implying a lack of strategic focus and/or lack of execution success.

Leverage & Liquidity MDT-US has additional debt capacity.

MDT-US has additional debt capacity.

Relative Valuation Medtronic Plc's current Price/Book of 3.85 is about median in its peer group.

Medtronic Plc's current Price/Book of 3.85 is about median in its peer group.

Valuation Drivers The market expects MDT-US to grow at about the same rate as the peers and to maintain the median returns it currently generates.

The market expects MDT-US to grow at about the same rate as the peers and to maintain the median returns it currently generates.

Drivers of Margin The company's relatively high pre-tax margin suggests tight control on operating costs versus peers.

The company's relatively high pre-tax margin suggests tight control on operating costs versus peers.

Growth Expectations While MDT-US's revenues growth has been below the peer median in the last few years, the market still gives the stock a PE ratio that is around peer median and seems to see the company as a long-term strategic bet.

While MDT-US's revenues growth has been below the peer median in the last few years, the market still gives the stock a PE ratio that is around peer median and seems to see the company as a long-term strategic bet.

Operations Diagnostic MDT-US has relatively high profit margins while operating with median asset turns.

MDT-US has relatively high profit margins while operating with median asset turns.

Sustainability of Returns MDT-US's return on assets currently and over the past five years is around the peer median and suggest that it does not have any particular operational advantages versus peers.

MDT-US's return on assets currently and over the past five years is around the peer median and suggest that it does not have any particular operational advantages versus peers.

Likely Corporate Actions

Dividend Action

Though relatively good current margins and cash flow levels along with a high dividend quality and a strong cash cushion (for its dividend) suggest that MDT-US is in a position to increase its dividend, the combination of interest coverage and relative debt to market equity raise possible questions about the use of cash to increase dividends.

Equity Action

The company's current share price is not sufficiently lower than its 52-week high (currently about 4.28% below) and does not justify a share buyback as the best use of cash at this time.

M&A Action Acquirer

Acquirer: The company could potentially acquire other companies because of its current size, valuation and capacity to absorb acquisitions. For more information, please refer to the Corporate Actions report.
MDT-US is one of the larger companies in this peer group and thus difficult to acquire.

Dividend Quality

Dividend Coverage Strong

The ending cash balance, with a dividend coverage of 12.49x, provides a substantial cushion in case of a significant reduction of cash flows in the future.

Dividend Quality High Quality

High Quality: Dividends that are fully covered from operating and investing cash flow, net of any cash outflow from debt repayments and net of a decrease in deposits (for banks) are considered to be high quality. For more information, please refer to the Corporate Actions report.
Over the last twelve months (prior to October 31, 2014), MDT-US paid a high quality dividend, which represents a yield of 1.54% at the current price.

Dividend Quality Trend

Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years -- of these 4 were high quality and 1 was medium quality.

Accounting Red Flags

Accounting Quality

MDT-US's strong relative net income margin for the last twelve months combined with a level of accruals that is around peer median suggest that the reported net income is supported by a reasonable level of accruals.

Management of Reserves

The company's accrual levels over the last twelve months are positive but around the peer median suggesting the company is recording a proper level of reserves relative to its peers.

Material Categories

Excluding the effects of change in revenue, the accounting categories causing the most impact on the movement of net income from the prior period to the current period are Business Combination Reserves, R&D and Pension Underfunded Amounts.
Characteristics
Key Valuation Items

Price to Book (P/B)

3.85

Price to Earnings (P/E)

25.73

Price to Sales

4.31

Price / EBITDA

12.63

Price to Assets

1.93

Price / FCF

19.95

EV / EBITDA

10.87

EV / FCF

17.16

Dividend Yield

1.57

PEG Ratio

Profitability

Gross Margin

77.25

EBIT Margin

29.22

Net Margin

16.75

FCF Margin

21.61

Operating Margin

29.22

Pre-Tax Margin

20.39

ROE

15.24

ROIC

8.93

ROA

7.73
Efficiency

Debt / Equity

70.37

Debt / Market

20.98

Debt / Book

Debt / EV

21.24

Coverage Ratio

29.06

Interest Coverage

12.81

Cash Days

298.71

Working Cap. Days

300.88

Receivable Days

79.25

Payable Days

14.11

Inventory Days

38.98

Sales / Assets

0.46
Growth

Earnings Growth YOY

-23.69

Revenue Growth YOY

3.60

Oper. CF Growth YOY

-12.08

EPS Growth YOY

-22.73

FCF Growth YOY

-12.58
Price History

Peers

FA Score

DQ Score

close

52 week range

76.05

55.85

79.45

USD

66.48

54.80

71.90

USD

90.46

75.78

98.24

USD

98.32

92.46

109.49

USD

116.23

90.48

121.84

USD

33.41

31.55

36.35

USD

67.01

65.94

77.31

USD

164.52

132.81

180.35

USD

Company Profile

Medtronic Plc Formerly known as Medtronic, Inc. The Group's principal activities are manufacturing, developing and marketing medical technology and providing device-based medical therapies. It operates in eight segments: Cardiac Rhythm Disease Management (CRDM), Spinal, CardioVascular, Neuromodulation, Diabetes, Surgical Technologies, Physio-Control. It provides lifelong solutions for people with chronic diseases. It also offers therapeutic and diagnostic devices used for the treatment of diabetes, neurological, gastroenterological, urological, and movement disorders, spinal and neurosurgery, neurodegenerative disorders and ear, nose and throat (ENT) surgery. It provides external and manual defibrillators. The Group operates in the United States, Europe, the Asia Pacific and other foreign countries.

Closing Stock Price

USD 76.05

As of Date

March 11, 2015

One Year Performance

26.2031%

One Month Performance

2.23149%

Industry Group

Medical Specialties

52 wk. Range

USD 55.85 - USD 79.45

Market Cap (Millions)

USD 74857.3

Total Shares Outstanding

979.516
Latest Filing Dates

Annual

April 30, 2014

Semi Annual

N/A

Quarterly

October 31, 2014

Next Release Date

May 19, 2015

Filing Currency

USD

Listed Exchange

NYSE
Peers


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21
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Put-these-on-your-radar
11h
$CTSO higher and higher and ready for the next move heading into Q end. DRs orders. $AMGN $MDT growth growth growth
Mar 12 6:23 PM
1
DrBadface
12h
Give me that $MDT $JUNO $DVA on $CTSO . Wake up the $TSLA $UVXY monkeys and show them Elon's bank account $V rack'em
Mar 12 5:25 PM
1
Adam "Ole Abe"
12h
Top Tier company $MDT - Buy IT, Hold IT for 7-10 years. Reinvest dividends. Retire early to Nude Beach. Drink Mai Tais - cheap thrills!
Mar 12 5:21 PM
1
DrBadface
1d
@makewaves $CTSO q4 earnings. FDA fast track? If cardiac partner is $JNJ $MDT Sorin or $FMS the hogs in the pit will staple $20s to pps. $V
Mar 12 2:37 AM
3 2
DailyStockPlays.com
1d
Gravestone Doji For March 12, 2015 http://stks.co/e1sUT $PETM $GILD $MDT $MON $ADSK $LRCX $ECL $ELX $FDO
Mar 11 10:58 PM
2
TalkMarkets
2d
There’s A New DivHut In Town $COV $MDT $MMM $ABT http://stks.co/s1fOR
Mar 10 9:39 PM
Mar 10 9:4 PM
2
TalkMarkets Recap
3d
There’s A New DivHut In Town $COV $MDT $MMM $ABT http://stks.co/j1wXR
Mar 10 3:39 PM
Matt
3d
Closed $MDT short for small gain.
Mar 10 3:5 PM
Matt
3d
$MDT short in the money today; stop set to make some.
Mar 10 2:26 PM
DrBadface
3d
$AAPL does the gold iwatch have a cytokine blood meter? Your cytokines too high? Don't worry $CTSO has a filter for that. $FMS $TSLA $V $MDT
Mar 10 12:2 PM
TalkMarkets
3d
There’s A New DivHut In Town $COV $MDT $MMM $ABT http://stks.co/d1rcC
Mar 10 9:27 AM
Michael Bixler
3d
$MNKD Couch Potato Anslyst. Well They're Not Going To Just Give Away Are They? $SNY $GOOG $AAPL $JNJ $MDT $NVS $MRK (Big Bio-PHARMA)
Mar 10 4:35 AM
1
alex
3d
Mar 10 2:51 AM
Matt
4d
Short $MDT ; looking like it may not hold the gap below....
Mar 9 1:36 PM
Stockroads
5d
$ABC , $AET , $AVGO , $BSX , $CVS , $DPS , $GPK , $MDT , $MMM , $MNST , $NQ , $ROST , $TSCO $WM $ZTS , weekly review http://stks.co/r1efx
Mar 8 4:58 PM
DrBadface
5d
If you want more info on the $CTSO tech http://stks.co/c1r4Q The more digging you do the better the story is! $13? $MDT $FMS $FSLR $JNJ $F
Mar 8 2:49 PM
Adam "Ole Abe"
6d
LT holder $MDT Just reinvest divis every qtr. Started buying back in 07'. At $76.5 I'll be buyer on a trade come Monday.
Mar 7 5:9 PM
Not smarter, just a name
7d
$MDT $77 should provide a bounce. This one is just itching to move in to the 80s.
Mar 6 3:57 PM
1
DrBadface
7d
$AAPL bought a couple iPad Air 2s at $COST last night. And a bunch of shares at 129 today. Loading $CTSO for some hope on $JUNO news or $MDT
Mar 6 3:27 PM
Analyst Ratings Network
7d
Medtronic's neutral rating reiterated at Zacks. $82.00 PT. http://stks.co/p1e0c $MDT
Mar 5 6:16 PM
Tad Doughty
9d
Too bond sales for WSJ $AAPL $ACT $MDT http://stks.co/f1u6l
Mar 4 2:53 PM
William S Burroughs
9d
$MDT should get $ETRM before it becomes very expensive.
Mar 4 2:23 PM
1
Krish Sekar
9d
$PCRX exparel fits perfectly in $MDT / $HSP 's drug portfolio (bupiv, ropiv etc), just buy them already
Mar 4 6:15 AM
Shelly
10d
$MDT short sellers better get out while they can, juicy dividend coming. Yum yum.
Mar 3 4:12 PM
DrBadface
10d
Can I use my $NXPI chip in my $AAPL ip6 to buy more shares of $CTSO before Dr. Chan drops some $MDT $JUNO news?Glad no one BoughtMyAsk $FMS
Mar 3 2:24 AM
1
Capital Market Laboratories
10d
$ISRG $ARAY $MDT Operating Margin Trends via @CapitalMarketLabs http://stks.co/a1oUY
Mar 2 9:6 PM
Insider Trades
10d
$MDT : New Insider Transaction on MDT by Insider OLEARY DENISE M: http://stks.co/p1cEJ
Mar 2 8:43 PM
Insider Trades
10d
$MDT : New Insider Transaction on mdt by Director OLEARY DENISE M: http://stks.co/f1t4O
Mar 2 8:41 PM
Zacks.com
11d
Which stocks performed best for the month of February? $MDT $CSCO $MTSN $RCKY $ONNN $KO http://stks.co/i1snQ
Mar 2 3:33 PM
2
Please Login to see your stream! No Twits! Your stream is empty No Twits for MDT!

Closing Stock Price

USD 76.05

As of Date

March 11, 2015

One Year Performance

26.20%

One Month Performance

2.23%

Industry Group

Medical Specialties

52 wk. Range

USD 55.85 - USD 79.45

Market Cap (Millions)

USD 74,857.3

Total Shares Outstanding (Millions)

979.52
Latest Filing Dates

Annual

April 30, 2014

Semi Annual

N/A

Quarterly

October 31, 2014

Next Release Date

May 19, 2015

Filing Currency

USD

Listed Exchange

NYSE
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