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RBC Capital reiterated its Outperform rating and $101.00 price target on Medtronic , Inc. (NYSE:MDT) Monday, highlighting the company’s renal denervation system as an underappreciated market opportunity. With a market capitalization of $110.48 billion and a robust dividend yield of 3.3%, Medtronic stands as a prominent player in the Healthcare Equipment & Supplies industry. InvestingPro analysis shows the stock is currently trading near its Fair Value.
The firm conducted a proprietary survey of 44 participants to assess the potential for Medtronic’s Symplicity Spyral renal denervation system, which treats hypertension. RBC identified reimbursement as the critical factor for unlocking what it describes as a "multi-billion global market."
The survey findings come ahead of an important Centers for Medicare & Medicaid Services (CMS) National Coverage Determination expected on or before July 11, 2025. This decision will significantly impact the reimbursement landscape for the technology.
RBC emphasized Medtronic’s "significant first mover advantage" in this treatment area, noting the company has positioned itself to capitalize on a "multi-decade runway" in a market with over 100 million potential patients globally.
The investment firm maintained its positive outlook on Medtronic stock, stating that investors have not fully appreciated the growth potential of the renal denervation opportunity that the company’s technology addresses.
In other recent news, Medtronic announced its plan to spin off its diabetes business into a separate entity named MiniMed, aiming to complete the separation within 18 months. The diabetes division contributes about 8% to Medtronic’s total revenue, and the spin-off is expected to streamline operations. Analysts from Needham have maintained a Hold rating on Medtronic’s stock, suggesting that while the separation may not immediately unlock significant value, it could enhance shareholder value over time. Truist Securities also maintained a Hold rating but increased their price target to $92, citing Medtronic’s better-than-expected organic revenue growth. They noted that the planned spin-off could lead to improved margins and earnings per share growth in the future.
Meanwhile, RBC Capital Markets reduced their price target for Medtronic to $101 but kept an Outperform rating, acknowledging the company’s 1% revenue and 3% earnings per share beat in the recent quarter. The firm highlighted the potential benefits of the diabetes segment separation, which could unlock value and streamline operations. Medtronic’s fiscal year 2026 earnings guidance was set below consensus, attributed partly to tariffs and increased investment rates. Despite these challenges, RBC analysts see potential upside in Medtronic’s mid-single-digit organic revenue growth outlook. The strategic moves by Medtronic, including the separation of the diabetes segment, indicate a focus on optimizing business structure and enhancing long-term growth prospects.
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