1. By: John Kurtz & Hannah Basta
Medtronic, PLC
(MDT)
By: John Kurtz & Hannah Basta

2. Company Overview
Offers medical equipment in 4 groups: cardiac & vascular, restorative therapies, minimally invasive therapies, and diabetes
Specializes in Diabetes management technology
Over 3 million Americans suffer from Type 1 Diabetes
September 2016: received FDA approval for first closed-loop insulin pump
Medtronic MiniMed 670G available for sale Spring 2017
Touted by: JDRF, ADA, WebMD, Time

3. Financial Overview Current Stock Price: $80.01 52 Week High: $89.27
52 Week Low: $69.35
Market Cap: $ billion
November 2016: Voluntary recall of StrataMR(TM) Adjustable Valves & Shunts
Recommendation Rating

4. Financial Overview (ctd.)
Total Revenue in 2014: $17.01 billion
Total Revenue in 2016: $28.83 billion
Gross Profit in 2014: $12.67 billion
Gross Profit in 2016: $19.69 billion
FY16: 25% increase in dividends ($4.5 billion)

5. Market Overview Diabetes Tech. Competitors: Animas, Tandem, Insulet
Medical Supplies Competitors: Stryker, Boston Scientific, Abbott, Intuitive Surgical
4/7/17 - Citigroup named Medtronic its top sector pick for medical supplies for the rest of 2017, replacing Boston Scientific and Intuitive Surgical
None of these companies has developed a closed-loop insulin pump system
Endocrinologists are heavily recommending Type 1 Diabetics move onto the MiniMed 670G due to its unique monitoring abilities

7. Market Share Segment Name Total Revenue Market Share Diabetes 10.41%
36.54%
Cardiac Rhythm Mgmt.
31.95%
26.33%
Cardiovascular
17.98%
12.48%
Neuromodulation
11.96%
20.99%
Surgical Tech
9.92%
0.81%
Restorative Therapies
39.93%
100%
Source:

8. Market Comparison Valuation MDT Industry Avg Sector Avg S&P 500
Price/Earnings
28.37
39.66
31.05
25.01
Price/Cash Flow
16.39
21.66
20.19
16.12
Price/Sales
3.49
0.87
1.01
0.77
Price/Book
2.19
4.12
8.12
6.79

9. Company Risk Product reliability/performance/quality
Recall of StrataMR(TM) Adjustable Valves & Shunts
Price elasticity
Product liability settlement costs
Costs to develop/acquire necessary technology upgrades
Health insurance plans & cost-containment measures

10. Spoiler Alert: It’s Good
Full Valuation
Spoiler Alert: It’s Good