Medtronic, Inc. (MDT) Earnings Likely to Hinge on FY23 Guidance, BofA Securities Expects Y/Y Declines
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BofA Securities analyst Travis Steed reiterated a Buy rating and $135.00 price target on Medtronic, Inc. (NYSE: MDT) ahead of FQ4 earnings this Thursday where official FY23 guidance is expected and will likely be the highlight.
The analyst stated "Three months ago MDT saw FY23 being around 5% rev growth (no plus) and low single digit EPS growth but since then supply chain got worse (avg medtech saw 50bps of incremental GM pressure which is worth 2 points of EPS growth for MDT) and FX got materially worse (our math is $1bn worse on revenue which could be a 1-2 point h/w to EPS - hedges make the EPS math difficult). These two headwinds suggest it is likely difficult for MDT to guide to EPS growth in FY23. MDT’s expectations for 5% rev growth in FY23 was dependent on the recovery which is playing out as expected but some uncertainty with China (7% of MDT) lockdowns and upcoming VBPs (spine/surgical stapling; 1-1.5% of exposure) likely leads MDT to guide to 4-5% for FY23, in our view."
Shares of Medtronic, Inc. closed at $102.53 yesterday.
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