Latest news with #MiniMed
Yahoo
22-05-2025
- Business
- Yahoo
Medtronic to split diabetes business into separate entity, targets IPO
Medtronic has announced plans to separate out its diabetes business into a new standalone company. The separation will serve to create an 'independent, scaled leader in diabetes' that boasts an ecosystem of insulin management devices including pumps and continuous glucose monitors, Medtronic said. The split will also in turn create a wholly 'more focused' Medtronic, with a more simplified portfolio in high margin growth markets. Medtronic's shares on the New York Stock Exchange (NYSE) fell by 2.27% at market close following the announcement on 21 May. 'It's going to give Medtronic some significant capital to increase their presence in other, more interventional, areas, especially in cardiovascular. They have a history of inorganic expansion, so I can see this as providing ammunition for a big acquisition in 2026-7,' said Dr Andrew Thompson, director of therapy research and analysis in medical devices for GlobalData reacting to the separation. With a preferred path of an initial public offering (IPO) and subsequent split-off, Medtronic anticipates the split to complete within 18 months through a series of capital markets transactions. Medtronic describes the vision for the new diabetes standalone as being a 'scaled, direct-to-consumer' business that is positioned positioned as 'the only company to commercialise a complete intensive insulin management ecosystem'. In addition, Medtronic anticipates that the separation will enable more focused investment into the new diabetes business's pipeline and manufacturing scale and automation, thereby positioning it for success in Automated Insulin Delivery and Smart MDI as it drives margin expansion over time. 'As for the spin out, it might not remain a spin out for that long. Medtronic recently gained US Food and Drug Administration (FDA) 510k approval on a new CGM sensor that is interoperable with Abbott devices, and both companies have an agreement. Abbott might be wishing to preserve that relationship. I wonder if the standalone company might be something that is a joint venture between the two,' Thompson commented. Medtronic's diabetes business represented 8% of its total revenues in FY 2025 at around $2.75bn, denoting a 10.7% year over year rise. However, the business unit's performance has recently been hampered by the FDA Class I recall of its MiniMed insulin pump system in 2024, resulting in a dent to consumer confidence amid tightening competition and mounting operational losses for the unit since 2022. According to a GlobalData market model, in 2024, Medtronic held respective US market share of around 6% and 7.3% in the insulin delivery and glucose monitoring segments. Medtronic Diabetes, umbrellaed under the wider Medtronic business, currently has 8,000 employees globally, with Que Dallara currently serving as the unit's executive vice president and CEO. Dallara is set to continue in such role once the diabetes unit has spun out. Medtronic CEO and chairman, Geoff Martha said: 'Active portfolio management is an important lever to delivering on our ongoing growth and success, and this decision shifts the Medtronic portfolio to have intense focus on our highest margin growth drivers where we have our strongest core competencies. 'I'm also excited about what the future holds for the Diabetes business. Que's impressive track record in driving growth and innovation has set Diabetes on a path to continued success, ensuring the needs of individuals with diabetes are met around the globe." Medtronic anticipates that its diabetes business separation will improve its adjusted gross margin by around 50 basis points, adjusted operating margins by around 100 basis points, and be 'immediately accretive' to adjusted EPS. "Medtronic to split diabetes business into separate entity, targets IPO" was originally created and published by Medical Device Network, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Yahoo
22-05-2025
- Business
- Yahoo
Medtronic is spinning off its diabetes business into standalone company
Medtronic announced Wednesday that it will spin off its diabetes business into a standalone company. The medical device giant, which is domiciled in Dublin, Ireland but has its main office in Fridley, Minnesota, confirmed that it is making the "strategic decision" to split off its diabetes arm to "create a more focused Medtronic, more simplified portfolio in high margin growth markets." The diabetes business currently employs 8,000 people and generates annual sales of around $2.5 billion, representing 8% of Medtronic revenue albeit only 4% of its operating profit. The split is anticipated to increase Medtronic's profit margins. The Wall Street Journal reports the move will allow the company to "focus on its more-profitable segments making devices for cardiovascular, neuroscience and medical surgery." While its diabetes business has been growing at a strong pace, it comes after a period of recovery when its MiniMed insulin pumps suffered product safety issues that sparked a warning from the Food and Drug Administration, and led to a delay in FDA clearance of MiniMed 780G pump, the Journal notes. The announcement came on a day the company said the tariff war enacted by the Trump administration could cost it between $200 million and $350 million over fiscal year 2026. The new company will be led by current Medtronic Diabetes president Que Dallara, and will be based in California, where Medtronic's diabetes business is currently located. "This marks a significant milestone in driving both Medtronic and the Diabetes business to achieve lasting value for Medtronic, our shareholders, customers, and patients," said Geoff Martha, chairman and CEO of Medtronic. "Active portfolio management is an important lever to delivering on our ongoing growth and success, and this decision shifts the Medtronic portfolio to have intense focus on our highest margin growth drivers where we have our strongest core competencies. I'm also excited about what the future holds for the Diabetes business. Que's impressive track record in driving growth and innovation has set Diabetes on a path to continued success, ensuring the needs of individuals with diabetes are met around the globe." The spinoff is expected to be completed in 18 months.
Irish Independent
21-05-2025
- Business
- Irish Independent
‘She has a great future' – Wexford student who did work experience with local TD wins national skills competition
The competition, which is run by CareersPortal, encourages Transition Year and Leaving Cert students who have completed work experience as part of their programmes to reflect on the skills which they have developed as well as exploring a future career. The competition, now in its 15th year, is a national event and had over 1,400 secondary school students take part this year. A number of RCS students entered the competition but just two, Colleen Waters (TY) and Valeriia Stepanenko (5th Year), were shortlisted for awards along with 27 students from other schools across the country. The ceremony began with Eimear Sinnott, CEO of CareersPortal, welcoming the students and also thanking them for their insight into the bright future with this generation enthusiastic young people. As part of the competition, the students had to write a diary evaluating their work experience, analysing skills they learned and improved on. They then had to conduct a career investigation into a career of their interest. Finally, they reflected on how the skills they learned during work experience could help them in their future career. Colleen received a highly commendable award in the Transition Year category, as she investigated a career in medicine after her work experience with RCSI Mini Med programme earlier this year, and she was awarded with a certificate and a Bluetooth speaker. Valeriia Stepanenko received the overall winner, ranking first place in the Leaving Certificate competition, as she investigated a career in diplomacy. Valeriia has huge interest in this area and completed her work experience with Wexford TD, George Lawlor, in the Dáil back in March. Valeriia was awarded a trophy and a MacBook Air laptop for first prize. The organisers of the competition commended her project, making a special mention on the fact of how her journey is a powerful example of the competition's impact on real-life aspirations. She was joined by her family in celebrating this momentous achievement at the awards ceremony. Accompanying the two students at the ceremony was the school's Guidance Councillor, Ms. Hayley Miller, who commented: 'It was a pleasure to have two students represent RCS at such a prestigious competition, we are so very proud.' 'It was a very proud moment for us as the girls worked exceptionally hard on finding work experience to suit their interests and got into the Dáil and St. Vincent's Hospital with RCSI because of their hard work and dedication. It was a pleasure to join them and see their work being celebrated on a national stage.' Deputy Lawlor, with whom Valeriia completed her work experience, could not attend the ceremony due to last minute Dáil commitments, however he said he is 'so delighted that Valeriia has received this recognition.' "Valeriia is a great young women with a great future ahead,' Deputy Lawlor added.
Yahoo
21-05-2025
- Business
- Yahoo
Medtronic to Separate Diabetes Business
Medical-device maker Medtronic plans to separate its diabetes business into a stand-alone company, the company said, in a move that hives off a division that had struggled but recently returned to growth. Under Medtronic's plan, the new unnamed company will also be publicly traded, Medtronic said. The diabetes business generated nearly $2.8 billion in sales in its most recent fiscal year, ending in April, up 10.7% from the prior year. Medtronic reported more than $34 billion in sales last year. How Two CEOs Mixed Romance and Business, Leading to Scandal Senators Question Shari Redstone Over Efforts to Reach CBS Settlement With Trump Watch Me Try Google's Live Language Translator. It's Wild. It Moved the 'Eras' Tour's Equipment. Now It's Worth Over $1 Billion. Ford Poured Billions Into Two EV Battery Plants. It's Only Using Part of One. Galway, Ireland-based Medtronic, which operates out of Minneapolis, will complete the process of separation within 18 months. The transaction will allow the diabetes business to grow faster, and for Medtronic to accelerate growth of its remaining divisions, Medtronic Chief Executive Geoff Martha said in an interview. 'To realize the full potential of what we're sitting on here, it's going to need more focus than we can provide, and more investment,' he said. By getting out of diabetes, Medtronic, one of the world's largest makers of medical devices, will be free to focus on its more-profitable segments making devices for cardiovascular, neuroscience and medical surgery. 'These are higher-margin markets than the diabetes space and they better leverage our core strengths as a company,' Martha said. That includes its new PulseSelect and Affera products, which use one of the hottest technologies in the industry, that administers bursts of electricity or pulsed-field ablation, to treat irregular heartbeats in patients. It also sells Symplicity Spyral, a device to treat hypertension. Medtronic's diabetes products are sold directly to patients and consist of wearable and disposable devices. The rest of Medtronic sells more complex devices such as surgical instruments and implants commercially to physicians and hospitals. The separation caps a yearslong campaign by Medtronic to turn around its diabetes franchise since it got a warning letter from the Food and Drug Administration in 2021 regarding product safety issues for its MiniMed insulin pumps. The letter delayed the FDA's clearance of the MiniMed 780G insulin pump until 2023. The company has rolled out other new products, and this year reported the fifth consecutive quarter of double-digit growth in its diabetes division. Diabetes products include its MiniMed insulin pump, which is part of a system that automatically delivers insulin to patients based on real-time monitoring of their blood sugar levels, and pens that connect with smartphones to help patients take timely insulin injections. Among the division's devices in the works are next-generation insulin pumps and smart pens. The company also joined with Abbott in 2024 to develop a glucose sensor that will work with Medtronic's products. The new company will have 8,000 employees and be based in Northridge, Calif., where the diabetes business is located, Medtronic said. It will be led by Que Dallara, head of Medtronic's diabetes business since joining in 2022. Medtronic's shares are up more than 7% this year. Company stock has risen more than 2% in the past year. Shares were up slightly in premarket trading Wednesday. Write to Jared S. Hopkins at Google Takes Aim at AI Firms Challenging Its Search Dominance Kraft Heinz Is Evaluating Strategic Transactions Tesla Sets Record With $139 Million Pay Package for Finance Chief UnitedHealth Built a Giant. Now Its Model Is Faltering. Why Disney's 'Lilo & Stitch' Is Set to Beat 'Mission: Impossible' at the Box Office Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-02-2025
- Business
- Yahoo
MDT Stock Trades Cheaper Than Peers Ahead of Q3 Earnings: Time to Buy?
Medtronic plc MDT is scheduled to report third-quarter fiscal 2025 results on Feb. 18, before the opening the last reported quarter, the company's adjusted earnings of $1.26 exceeded the Zacks Consensus Estimate by 1.61%. Medtronic beat estimates in each of the trailing four quarters, the average surprise being 1.99%. The Zacks Consensus Estimate for fiscal third-quarter revenues is pegged at $8.33 billion, suggesting growth of 2.9% year over year. The consensus estimate for third-quarter earnings is pegged at $1.36 per share, indicating a 4.6% rise on a year-over-year basis. Fiscal third-quarter earnings estimates for Medtronic have edged down 0.7% to $1.36 per share over the past 90 days. Despite the company registering earnings beat over the trailing four quarters, estimates have been southbound, reflecting challenges due to rising costs and expenses as a result of inflationary and global geopolitical pressure through the months of the fiscal third quarter. Elevated raw material and labor costs are expected to have had a notable impact on the company's profitability during this period. Additionally, the insulin pump recall in October, notifying Medtronic MiniMed 600 series or 700 series insulin pump users of potential risks of shortened pump battery life, might have impacted third-quarter performance, adding to investors' concern. Image Source: Zacks Investment Research Let's look at how things have shaped up for Medtronic before the announcement. Since the past several quarters, Medtronic's earnings growth has been held back by headwinds like cost escalation and currency impacts. In the second quarter of fiscal 2025, the company-adjusted gross margin was down 70 basis points due to the adverse impact of currency. Company-adjusted operating margin also declined 90 basis points year over year due to unfavorable currency translation apart from supply issues. Although December data from the U.S. Bureau of Labor Statistics (BLS) indicates a slowdown in core inflation, the previous two months recorded relatively higher percentages. Additionally, a high-interest rate environment through the fiscal third quarter may have continued to make borrowing more challenging during this period. Added to this, unfavorable currency movements are once again likely to have acted as a major dampener during the fiscal third quarter, as in the case of other important MedTech players too. Medtronic expects its fiscal 2025 third-quarter revenues to reflect an unfavorable impact of 1% from currency translation. Further, the earlier-mentioned product recall within the Diabetes business too might have had a full-quarter impact on fiscal third-quarter Diabetes segment sales. Despite these challenges, Medtronic has consistently showcased the resilience of its underlying business fundamentals, delivering mid-single-digit organic revenue growth for several quarters in a row. While its recent product launches have been driving growth across multiple businesses, the swift pace of several compelling product approvals promises consistent growth in the years to come. Particularly, the company's pulse field ablation, TAVR, neuromodulation, hypertension, robotics and diabetes businesses are expected to have registered growth in the to-be-reported quarter, banking on several new product launches. Within the company's Established Market Leaders category, the company might have witnessed growth in the Cranial & Spinal Technologies segment on the increasing adoption of AiBLE ecosystem of differentiated spine implants. Further, Mazor Robotics, StealthStation navigation, O-arm Imaging and Midas Rex powered surgical instruments are expected to have witnessed growth. In Cardiac Pacing Therapies, the Micra leadless pacemaker franchise is expected to have recorded strong growth, driven by the adoption of its latest generation, Micra AV2 and VR2. In Defibrillation Solutions, the Aurora EV-ICD's adoption is expected to have remained strong in the fiscal third quarter. Among the company's Synergistic businesses, Medtronic is expected to report strong growth within the Neuromodulation segment, driven by broad-based growth across product lines, including Pain Stim and Brain Modulation. Pelvic Health, Coronary and Peripheral Vascular too are expected to have registered growth in the third quarter. Among Medtronic's Highest Growth Markets businesses, the company is likely to have gained traction within the Cardiac Ablation Solutions arm, driven by the strong sales of Pulse Field ablation products, which are more than offsetting declines in the cryoablation product line. Medtronic's Diabetes unit likely experienced strong growth in the United States in the fiscal third quarter, with the global adoption of the MiniMed 780G AID system driving performance. Further, Simplera Sync sensor and the newly FDA-approved InPen app (which paved the way for a limited U.S. release of the SMART MDI system with Simplera CGM) might have boosted growth in the fiscal third quarter. Despite issues related to battery life of MiniMed 600 and 700 series, the company might have witnessed a positive top-line contribution in the fiscal third quarter from this business. Our proven model does not conclusively predict an earnings beat for Medtronic this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that's not the case here. MDT has an Earnings ESP of 0.00% and carries a Zacks Rank of 3 currently. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter. In recent years, the company has made some foundational changes to the organization, including streamlining the operating model, improving global operations, supply chain and quality, and bringing in expertise from outside the industry. It is actively allocating capital to fast-growth MedTech markets and fueling innovative technologies in areas like robotics, AI and closed-loop systems that ensure its growth over the next decade. Medtronic's revenues have improved and become more durable from implementing a performance-driven culture and changing incentives underlying the new product approvals in major markets. With top priority placed on restoring the company's earnings power, these actions are expected to eventually result in better-leveraged earnings growth through margin stabilization and improvement. Medtronic's highest growth opportunities, comprising 20% of its revenues, are in markets that are large and growing faster than the overall company. For example, in Cardiac Ablation, it has significantly invested in the Electrophysiology arm to expand its share in the attractive $8 billion-plus market. Medtronic's strong liquidity position should allow it to meet its near-term debt obligations. Medtronic apparently looks quite burdened by debt, with total debt (including the current portion) of $28.30 billion as of Oct 31, 2024. The company's cash and cash equivalents were $7.99 billion at the end of the last-reported quarter. Although the quarter's total debt was much higher than the corresponding cash and cash equivalent level, the short-term payable debt of $3.72 billion remains lower than the short-term cash level. The company's times interest earned ratio too is at an impressive level of 7.7 indicating that Medtronic is well capable of paying the interest on its business debts on time. In the fiscal third quarter, Medtronic stock declined 10.5% compared with the industry's 4% drop. In contrast, the S&P 500 rose 4.1%. The company also underperformed its direct peers, such as Abbott's ABT 0.1% rise and Boston Scientific's BSX 6.2% rise during this time span. Image Source: Zacks Investment Research Going by the Price/Earnings ratio, MDT shares currently trade at 15.74X forward earnings, well short of its five-year high of 30.08X and below the median of 16.56X. The stock is also trading significantly below the industry's 22.73X and S&P 500's 22.54X. The company is also trading at a significant discount to other industry players like Boston Scientific, with its current P/E being 36.71X, and Abbott, whose current P/E is 25.19X. This suggests that investors may be paying a lower price relative to the company's expected earnings growth. MDT has a Value Score of C at present. Image Source: Zacks Investment Research While Medtronic holds immense potential for long-term growth, given its momentum, ongoing comprehensive transformation, breakthrough innovations and exposure to strong secular growth markets, the company battles significant headwinds from macroeconomic issues and rising expenses, which can significantly dent its bottom-line growth. Further, we are also concerned about the product recall issue, which could erode patient trust in Medtronic's diabetes care offerings. For now, it might be prudent for investors to avoid buying the stock and monitor MDT's upcoming results for a better entry point. You can see the complete list of today's Zacks Rank #1 stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abbott Laboratories (ABT) : Free Stock Analysis Report Boston Scientific Corporation (BSX) : Free Stock Analysis Report Medtronic PLC (MDT) : Free Stock Analysis Report To read this article on click here. Zacks Investment Research Sign in to access your portfolio
