Medtronic’s Earnings — Blah

Despite getting some great press for Barron’s, Medtronic’s (MDT) earnings report was rather uninspiring. Their fiscal Q4 earnings came in at $250 million or just 22 cents a share. That’s a huge drop from the 78 cents a share they made a year. However, if you knock out all the charges, and there were many, the company made 82 cents a share which was in line with the Street.
The Wall Street Journal reports:

Revenue slipped 0.8% to $3.83 billion. In February, the company had said it expected revenue of about $3.84 billion. Excluding currency fluctuations, revenue grew 5%. Sales of heart-rhythm devices fell 5% as ICD sales declined 3.2%. The spinal business grew 1%.
Cardiovascular revenue was flat amid a 15% fall for stents, the scaffoldings that prop open arteries. The company said late Monday that the Endeavor stent was the first coronary stent to receive the European Economic Area’s CE mark of approval for treating patients with acute coronary syndrome, which includes unstable angina and heart attacks.

What’s more, the company is cutting 1,500 to 1,800 jobs. For this fiscal year, Medtronic projects earnings at $3.10 to $3.20 per share where the Street was looking for $3.20.
I have to agree that the stock is cheap, but I think it will become even cheaper. If you’re looking to add shares, wait for it to drop below $30.
Here’s a look at MDT’s sales and earnings for the past several quarters:
Quarter………..EPS………….Sales
Jul-01…………$0.28………..$1,455.70
Oct-01………..$0.29………..$1,571.00
Jan-02………..$0.30………..$1,592.00
Apr-02………..$0.34………..$1,792.00
Jul-02…………$0.32………..$1,713.90
Oct-02………..$0.34………..$1,891.00
Jan-03………..$0.35………..$1,912.50
Apr-03………..$0.40………..$2,148.00
Jul-03…………$0.37………..$2,064.20
Oct-03………..$0.39………..$2,163.80
Jan-04………..$0.40………..$2,193.80
Apr-04………..$0.48………..$2,665.40
Jul-04…………$0.43………..$2,346.10
Oct-04………..$0.44………..$2,399.80
Jan-05………..$0.46………..$2,530.70
Apr-05………..$0.53………..$2,778.00
Jul-05…………$0.50………..$2,690.40
Oct-05………..$0.54………..$2,765.40
Jan-06………..$0.55………..$2,769.50
Apr-06………..$0.62………..$3,066.70
Jul-06…………$0.55………..$2,897.00
Oct-06………..$0.59………..$3,075.00
Jan-07………..$0.61………..$3,048.00
Apr-07………..$0.66………..$3,280.00
Jul-07…………$0.62………..$3.127.00
Oct-07………..$0.58………..$3,124.00
Jan-08………..$0.63………..$3,405.00
Apr-08………..$0.78………..$3,860.00
Jul-08…………$0.72………..$3.706.00
Oct-08………..$0.67………..$3,570.00
Jan-09………..$0.71………..$3,494.00
Apr-09………..$0.78………..$3,830.00

Posted by Eddy Elfenbein on May 19th, 2009 at 11:47 am

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