MEDTRONIC PLC (MDT) Stock Fundamental Analysis
USA - NYSE:MDT - IE00BTN1Y115 - Common Stock
95.78 USD
+0.74 (+0.78%)
95.97 USD
+0.19 (+0.2%)
We assign a fundamental rating of 6 out of 10 to MDT. MDT was compared to 190 industry peers in the Health Care Equipment & Supplies industry. MDT has an excellent profitability rating, but there are some minor concerns on its financial health. MDT has a correct valuation and a medium growth rate. MDT also has an excellent dividend rating. These ratings would make MDT suitable for dividend investing!
1. Profitability
1.1 Basic Checks
In the past year MDT was profitable.
MDT had a positive operating cash flow in the past year.
MDT had positive earnings in each of the past 5 years.
Each year in the past 5 years MDT had a positive operating cash flow.
1.2 Ratios
The Return On Assets of MDT (5.12%) is better than 82.63% of its industry peers.
MDT's Return On Equity of 9.73% is amongst the best of the industry. MDT outperforms 85.26% of its industry peers.
MDT has a better Return On Invested Capital (6.74%) than 82.11% of its industry peers.
MDT had an Average Return On Invested Capital over the past 3 years of 6.35%. This is below the industry average of 8.88%.
The last Return On Invested Capital (6.74%) for MDT is above the 3 year average (6.35%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.12% | ||
| ROE | 9.73% | ||
| ROIC | 6.74% |
ROA(3y)4.43%
ROA(5y)4.54%
ROE(3y)8.11%
ROE(5y)8.19%
ROIC(3y)6.35%
ROIC(5y)6.24%
1.3 Margins
MDT has a Profit Margin of 13.63%. This is amongst the best in the industry. MDT outperforms 92.11% of its industry peers.
In the last couple of years the Profit Margin of MDT has declined.
MDT has a Operating Margin of 19.57%. This is amongst the best in the industry. MDT outperforms 92.63% of its industry peers.
MDT's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 65.38%, MDT is in the better half of the industry, outperforming 70.53% of the companies in the same industry.
MDT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.57% | ||
| PM (TTM) | 13.63% | ||
| GM | 65.38% |
OM growth 3Y-3.47%
OM growth 5Y0.37%
PM growth 3Y-4.39%
PM growth 5Y-3.44%
GM growth 3Y-1.55%
GM growth 5Y-0.76%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so MDT is still creating some value.
MDT has less shares outstanding than it did 1 year ago.
The number of shares outstanding for MDT has been reduced compared to 5 years ago.
Compared to 1 year ago, MDT has a worse debt to assets ratio.
2.2 Solvency
MDT has an Altman-Z score of 2.97. This is not the best score and indicates that MDT is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of MDT (2.97) is better than 68.42% of its industry peers.
The Debt to FCF ratio of MDT is 5.39, which is a neutral value as it means it would take MDT, 5.39 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 5.39, MDT is doing good in the industry, outperforming 79.47% of the companies in the same industry.
A Debt/Equity ratio of 0.55 indicates that MDT is somewhat dependend on debt financing.
MDT's Debt to Equity ratio of 0.55 is on the low side compared to the rest of the industry. MDT is outperformed by 61.58% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 5.39 | ||
| Altman-Z | 2.97 |
ROIC/WACC1.01
WACC6.64%
2.3 Liquidity
A Current Ratio of 2.01 indicates that MDT has no problem at all paying its short term obligations.
MDT has a Current ratio of 2.01. This is in the lower half of the industry: MDT underperforms 64.21% of its industry peers.
A Quick Ratio of 1.50 indicates that MDT should not have too much problems paying its short term obligations.
MDT's Quick ratio of 1.50 is in line compared to the rest of the industry. MDT outperforms 40.53% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.01 | ||
| Quick Ratio | 1.5 |
3. Growth
3.1 Past
MDT shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.53%.
The Earnings Per Share has been growing slightly by 3.68% on average over the past years.
MDT shows a small growth in Revenue. In the last year, the Revenue has grown by 4.98%.
MDT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.01% yearly.
EPS 1Y (TTM)5.53%
EPS 3Y-0.72%
EPS 5Y3.68%
EPS Q2Q%2.44%
Revenue 1Y (TTM)4.98%
Revenue growth 3Y1.91%
Revenue growth 5Y3.01%
Sales Q2Q%6.68%
3.2 Future
The Earnings Per Share is expected to grow by 6.47% on average over the next years.
The Revenue is expected to grow by 5.37% on average over the next years.
EPS Next Y3.35%
EPS Next 2Y5.65%
EPS Next 3Y6.08%
EPS Next 5Y6.47%
Revenue Next Year7.03%
Revenue Next 2Y6.24%
Revenue Next 3Y5.69%
Revenue Next 5Y5.37%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
MDT is valuated rather expensively with a Price/Earnings ratio of 17.32.
MDT's Price/Earnings ratio is rather cheap when compared to the industry. MDT is cheaper than 82.11% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.42. MDT is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 15.60, which indicates a correct valuation of MDT.
MDT's Price/Forward Earnings ratio is rather cheap when compared to the industry. MDT is cheaper than 85.26% of the companies in the same industry.
MDT is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.94, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.32 | ||
| Fwd PE | 15.6 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MDT is valued cheaply inside the industry as 81.05% of the companies are valued more expensively.
MDT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. MDT is cheaper than 84.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.17 | ||
| EV/EBITDA | 14.16 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MDT does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of MDT may justify a higher PE ratio.
PEG (NY)5.18
PEG (5Y)4.7
EPS Next 2Y5.65%
EPS Next 3Y6.08%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.99%, MDT has a reasonable but not impressive dividend return.
MDT's Dividend Yield is rather good when compared to the industry average which is at 1.83. MDT pays more dividend than 98.42% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, MDT pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.99% |
5.2 History
The dividend of MDT has a limited annual growth rate of 5.10%.
MDT has been paying a dividend for at least 10 years, so it has a reliable track record.
MDT has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.1%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
MDT pays out 77.27% of its income as dividend. This is not a sustainable payout ratio.
The dividend of MDT is growing, but earnings are growing more, so the dividend growth is sustainable.
DP77.27%
EPS Next 2Y5.65%
EPS Next 3Y6.08%
95.78
+0.74 (+0.78%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners87.1%
Inst Owner Change-0.1%
Ins Owners0.29%
Ins Owner Change5.53%
Market Cap122.86B
Analysts73.33
Price Target100.56 (4.99%)
Short Float %1%
Short Ratio1.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.99% |
Yearly Dividend2.77
Dividend Growth(5Y)5.1%
DP77.27%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.54%
Min EPS beat(2)1.49%
Max EPS beat(2)1.59%
EPS beat(4)3
Avg EPS beat(4)1.05%
Min EPS beat(4)-0.08%
Max EPS beat(4)1.59%
EPS beat(8)6
Avg EPS beat(8)1.56%
EPS beat(12)9
Avg EPS beat(12)1.82%
EPS beat(16)10
Avg EPS beat(16)1.17%
Revenue beat(2)2
Avg Revenue beat(2)0.54%
Min Revenue beat(2)0.17%
Max Revenue beat(2)0.91%
Revenue beat(4)3
Avg Revenue beat(4)0.07%
Min Revenue beat(4)-1.38%
Max Revenue beat(4)0.91%
Revenue beat(8)6
Avg Revenue beat(8)0.26%
Revenue beat(12)9
Avg Revenue beat(12)0.38%
Revenue beat(16)10
Avg Revenue beat(16)-0.26%
PT rev (1m)0%
PT rev (3m)2.23%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.7%
EPS NY rev (1m)0.25%
EPS NY rev (3m)1.38%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)1.45%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.32 | ||
| Fwd PE | 15.6 | ||
| P/S | 3.59 | ||
| P/FCF | 23.17 | ||
| P/OCF | 17.19 | ||
| P/B | 2.57 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.16 |
EPS(TTM)5.53
EY5.77%
EPS(NY)6.14
Fwd EY6.41%
FCF(TTM)4.13
FCFY4.32%
OCF(TTM)5.57
OCFY5.82%
SpS26.66
BVpS37.34
TBVpS-4.16
PEG (NY)5.18
PEG (5Y)4.7
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.12% | ||
| ROE | 9.73% | ||
| ROCE | 8.43% | ||
| ROIC | 6.74% | ||
| ROICexc | 7.5% | ||
| ROICexgc | 29.59% | ||
| OM | 19.57% | ||
| PM (TTM) | 13.63% | ||
| GM | 65.38% | ||
| FCFM | 15.51% |
ROA(3y)4.43%
ROA(5y)4.54%
ROE(3y)8.11%
ROE(5y)8.19%
ROIC(3y)6.35%
ROIC(5y)6.24%
ROICexc(3y)7.09%
ROICexc(5y)7.05%
ROICexgc(3y)29.85%
ROICexgc(5y)33.32%
ROCE(3y)7.94%
ROCE(5y)7.8%
ROICexcg growth 3Y-11.61%
ROICexcg growth 5Y-5.52%
ROICexc growth 3Y-2.49%
ROICexc growth 5Y3.26%
OM growth 3Y-3.47%
OM growth 5Y0.37%
PM growth 3Y-4.39%
PM growth 5Y-3.44%
GM growth 3Y-1.55%
GM growth 5Y-0.76%
F-Score7
Asset Turnover0.38
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 5.39 | ||
| Debt/EBITDA | 2.72 | ||
| Cap/Depr | 62.54% | ||
| Cap/Sales | 5.39% | ||
| Interest Coverage | 9.24 | ||
| Cash Conversion | 74.13% | ||
| Profit Quality | 113.8% | ||
| Current Ratio | 2.01 | ||
| Quick Ratio | 1.5 | ||
| Altman-Z | 2.97 |
F-Score7
WACC6.64%
ROIC/WACC1.01
Cap/Depr(3y)59.68%
Cap/Depr(5y)55.94%
Cap/Sales(3y)5.04%
Cap/Sales(5y)4.79%
Profit Quality(3y)124.85%
Profit Quality(5y)125.74%
High Growth Momentum
Growth
EPS 1Y (TTM)5.53%
EPS 3Y-0.72%
EPS 5Y3.68%
EPS Q2Q%2.44%
EPS Next Y3.35%
EPS Next 2Y5.65%
EPS Next 3Y6.08%
EPS Next 5Y6.47%
Revenue 1Y (TTM)4.98%
Revenue growth 3Y1.91%
Revenue growth 5Y3.01%
Sales Q2Q%6.68%
Revenue Next Year7.03%
Revenue Next 2Y6.24%
Revenue Next 3Y5.69%
Revenue Next 5Y5.37%
EBIT growth 1Y8.97%
EBIT growth 3Y-1.62%
EBIT growth 5Y3.4%
EBIT Next Year19.44%
EBIT Next 3Y10.76%
EBIT Next 5Y9.23%
FCF growth 1Y19.33%
FCF growth 3Y-4.64%
FCF growth 5Y-2.95%
OCF growth 1Y22.55%
OCF growth 3Y-1.39%
OCF growth 5Y-0.53%