Medtronic (MDT) Up 1.5% Since Last Earnings Report: Can It Continue?

Core Viewpoint - Medtronic's recent earnings report shows a positive trend in earnings and revenues, but there are concerns about future performance as estimates have trended downward recently [1][10][12]. Financial Performance - Medtronic reported Q1 fiscal 2026 adjusted earnings per share of $1.26, a 2.4% increase from the previous year, beating estimates by 2.4% [2]. - Worldwide revenues reached $8.58 billion, reflecting an 8.3% year-over-year increase and surpassing estimates by 2.5% [3]. Segmental Analysis - Cardiovascular segment revenues grew 7% organically to $3.23 billion, with Cardiac Rhythm & Heart Failure sales at $1.71 billion, up 9.1% [4]. - Medical Surgical revenues totaled $2.08 billion, a 2.4% organic increase, while Neuroscience revenues were $2.42 billion, up 3.1% [5][6]. Margin Performance - Gross margin contracted by 10 basis points to 65%, attributed to an 8.7% rise in revenue costs [7]. - Adjusted operating margin improved by 81 basis points to 23.8% [7]. Fiscal 2026 Outlook - Medtronic projects organic revenue growth of 5% for fiscal 2026, with reported revenue growth expected to be between 6.5% and 6.8% [8][9]. - The Zacks Consensus Estimate for fiscal 2026 revenues is $35.29 billion, indicating a 5.2% growth from the previous year [9]. Estimate Revisions - Estimates for Medtronic have trended downward over the past month, indicating a potential shift in market expectations [10][12]. Industry Comparison - Medtronic operates within the Zacks Medical - Products industry, where competitor QuidelOrtho has seen a 9.1% gain over the past month [13].