Medtronic Earns 99 Cents Per Share

Medtronic ($MDT) is keeping it real. For its fiscal Q4, the company reported earnings of 99 cents per share. That’s a penny ahead of expectations and a 10% increase from a year ago. In February, the medical equipment company told us to expect Q4 earnings between 97 cents and $1 per share. Quarterly revenues rose 4% to 4.3 billion.

Demand for pacemakers and defibrillators, the company’s biggest product category, is starting to return, said Rick Wise, a Leerink Swann & Co. analyst in New York. U.S. approval of the Resolute Integrity stent in February to treat clogged heart arteries and the conclusion of a Justice Department investigation into the Infuse bone strengthening product should pave the way for faster growth next year, analysts said.

Now let’s look at the full-year numbers because this was a good year for Medtronic. Earnings rose from $3.37 to $3.46 per share. A year ago, they gave us full-year guidance of $3.43 to $3.50 per share which was dead on target. In 2010, Medtronic cut their forecast several times, but this year they held firm throughout the year.

For 2013, Medtronic sees earnings ranging between $3.62 and $3.70 per share. The Street was expecting $3.66 per share. Officially, that will be reported as “inline guidance” but I’m very pleased with it.

Sometime next month, I expect Medtronic will raise its quarterly dividend. The current payout is 24.25 cents per share which works out to a yearly dividend of 97 cents per share (or 2.57%). If I had to guess, I think it will be a modest increase — to 25 or 26 cents per share. This will mark their 35th-straight dividend increase.

Posted by on May 22nd, 2012 at 9:47 am

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.