Investing.com - Bernstein SocGen Group lowered its price target on Medtronic, Inc. (NYSE:MDT) to $97 from $112 while maintaining an Outperform rating on the stock. The shares currently trade at $77.95, suggesting potential upside to the new target. According to InvestingPro analysis, the stock appears undervalued and is trading near its 52-week low of $73.31, offering a 3.64% dividend yield backed by 50 consecutive years of payments.
The medical device company reported fourth-quarter sales of $9.8 billion, representing 6.6% organic growth and exceeding consensus estimates of $9.6 billion by 1.8%. Cardiac Ablation Solutions grew 78%, adding approximately 8 percentage points of U.S. market share driven by the continued Affera PFA rollout, and is expected to reach $2 billion in trailing-12-month sales in the first quarter of fiscal year 2027.
Fourth-quarter earnings per share of $1.55 declined 4% year-over-year but met consensus expectations. MedSurg contributed to the quarter with a 4% revenue beat on 5% organic growth.
Medtronic is guiding to underlying organic growth of 5.5% to 6.0% for fiscal year 2027, or 6.75% to 7.25% including an extra week in the fiscal year. The company projects earnings per share of $5.90 to $6.00, representing 6.7% to 8.5% growth.
The firm noted that after weaker earnings per share growth over the past four years of negative 5%, negative 2%, positive 6%, and positive 1%, the company aims to successfully separate its MMED unit before the end of calendar year 2026.
In other recent news, Medtronic reported fourth-quarter fiscal 2026 revenue of $9.8 billion, which represented a 6.6% organic growth and exceeded the consensus estimate of $9.62 billion. The company’s earnings per share (EPS) came in at $1.55, aligning closely with the consensus estimate of $1.54. Additionally, Medtronic provided fiscal 2027 revenue guidance above consensus, though its EPS guidance was below consensus. Analyst firm Jefferies lowered its price target for Medtronic to $88 from $95 while maintaining a Hold rating. Meanwhile, BTIG upgraded Medtronic’s stock rating to Buy from Neutral, citing a favorable growth outlook and setting a price target of $90. Needham also adjusted its price target for Medtronic, reducing it to $101 from $120, but maintained a Buy rating. These developments reflect a mixed analyst outlook amid Medtronic’s strong earnings performance.
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