Medtronic: Margin Inflection With Diabetes Spin - Key Drivers

Moretus Research
573 Followers

Summary

  • Initiate Medtronic with Strong Buy, $161 PT, citing a structural margin inflection from Diabetes spin-off and robust innovation pipeline (120+ approvals).
  • Street underestimates FY27 margin/EPS upside from Diabetes separation and operating leverage in Cardiac & Structural Heart—key drivers for re-rating.
  • Valuation at 26x FY27E EPS is conservative versus peers; scenario analysis shows risk skewed to the upside, as margin catalysts execute.
  • Key risks: tariff/cost headwinds and regulatory setbacks could delay margin recovery, but risk/reward is compelling for long-term allocators.

Coronary Angiography

Nirian

Margin Renaissance In Medtech

We initiate on Medtronic plc (NYSE:MDT) with Strong Buy, $161 PT. Medtronic plc develops best-in-class device-based medical therapies spanning CV, Surgical, Neuro, and Diabetes/MedSurg across global health systems. Behind the hum of industry skepticism,

This article was written by

Moretus Research
573 Followers
Moretus Research delivers state-of-the-art, buy-side quality equity research for serious investors seeking clarity, conviction, and alpha. Focused on U.S. public markets, Moretus applies a structured, repeatable framework to identify companies with durable business models, mispriced cash flow potential, and intelligent capital allocation. Built on institutional standards, Moretus Research combines rigorous fundamental analysis with a high-signal, judgment-driven process—eschewing noise, narrative, and overly complex forecasting. Valuation is based on pragmatic, sector-relevant multiples tailored to each company’s business model and capital structure, with an emphasis on comparability, simplicity, and relevance. Research coverage tends to favor underappreciated companies undergoing structural change or temporary dislocation—situations where dispassionate analysis and variant perception can lead to asymmetric returns. All work reflects a deep respect for capital, discipline, and long-term compounding. Moretus Research aims to raise the standard for independent investment research—providing professional-grade insights, actionable valuation, and a strong filter for what truly matters in modern equity analysis.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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