Medtronic Just Retired 55 Million Shares Without Spending Cash. Is the Stock a Buy?
Medtronic (NYSE: MDT) is entering new waters after spinning off its diabetes segment, now called MiniMed (NASDAQ: MMED) . The hope for the medical devices company is that the move will unlock greater margins. It's already helped the stock in one way. As part of the deal, Medtronic received approximately 55 million of its own shares in the final results of its oversubscribed split-off and exchange offer for MiniMed. That means Medtronic's future net income will be distributed across a smaller number of shares, making it easier for the company to increase earnings per share (EPS). Investors have been a bit dubious about the stock, despite strong financials. It's down just under 1% so far this year, but over the last three months, it has climbed more than 11%. Here are three reasons why Medtronic might be a buy. Continue reading