Medtronic to Spin Off Diabetes Unit, Focus on Profitable Growth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Business Focus: Medtronic plans to spin off its diabetes unit into a standalone public company by the end of 2026, as this segment accounted for only 8% of revenue but contributed just 4% of operating profits in fiscal 2025, allowing for a sharper focus on B2B operations and unlocking higher profit growth potential.
- New Growth Driver: Medtronic received regulatory approval for the Hugo system, a robotic-assisted surgery device for urologic procedures, which, while not expected to boost revenue significantly in the short term, opens up a long-term opportunity in an underpenetrated robotic surgery market with attractive growth prospects.
- Dividend Growth Streak: Medtronic has increased its dividends for 48 consecutive years, currently offering a 3% yield, and is on track to become a Dividend King in the next few years, making it an attractive option for income-seeking investors.
- Competitive Advantage: Despite stiff competition from other medical device leaders, Medtronic's entry into the robotic surgery market represents a significant strategic development, and as shipments of the Hugo system gain traction, it is expected to positively impact the company's financial performance.
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.
