Medtronic Divests Diabetes Business to Enhance Margins
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: NASDAQ.COM
- Divestiture Decision: Medtronic plans to complete the divestiture of its diabetes business by the end of 2026, which accounted for only 8% of revenue but contributed 4% of operating profits in fiscal year 2025, allowing the company to focus more on B2B operations and enhance overall margins.
- Competitive Pressure: Medtronic has struggled to keep pace with industry leaders in the diabetes care market, particularly in continuous glucose monitoring systems and insulin pumps, and divesting this business will help the company concentrate resources on more competitive product lines.
- Robotic Surgery Market Opportunity: Medtronic received regulatory approval for the Hugo system, and while it won't significantly boost revenue in the short term, this entry into the robotic surgery market presents long-term growth potential, especially in the underpenetrated minimally invasive surgery sector.
- Dividend Growth Potential: Medtronic has increased its dividends for 48 consecutive years, with a current yield of 3%, and is on track to become a Dividend King in the coming years, making its stock attractive to income-seeking investors.
Analyst Views on MDT
Wall Street analysts forecast MDT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MDT is 110.47 USD with a low forecast of 90.00 USD and a high forecast of 119.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
21 Analyst Rating
10 Buy
11 Hold
0 Sell
Moderate Buy
Current: 99.000
Low
90.00
Averages
110.47
High
119.00
Current: 99.000
Low
90.00
Averages
110.47
High
119.00
About MDT
Medtronic Public Limited Company is an Ireland-based company, which provides healthcare technology solutions. The Company’s products category includes Advanced Surgical Technology; Cardiac Rhythm; Cardiovascular; Digestive & Gastrointestinal; Ear, Nose & Throat; General Surgery; Gynecological; Neurological; Oral & Maxillofacial; Patient Monitoring; Renal Care; Respiratory; Spinal & Orthopedic; Surgical Navigation & Imaging; Urological; Product Manuals; Product Ordering & Inquiries; and Product Performance & Advisories. Its products include Cardiac Implantable Electronic Device (CIED) Stabilization, Aortic Stent Graft Products, CareLink Personal Therapy Management Software, CareLink Pro Therapy Management Software. Its services and solutions include Ambulatory Surgery Center Resources, Care Management Services, Digital Connectivity Information Technology (IT) Support, Equipment Services and Support, Innovation Lab, Medtronic Healthcare Consulting, and Office-Based Sinus Surgery.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
