Medtronic plc’s MDT Restorative Therapies Group (“RTG”) has been on a strong growth trajectory of late owing to a solid contribution from majority of the sub-segments.
We expect this uptick to get reflected in first-quarter fiscal 2020 results, which are scheduled to be released on Aug 20, before the opening bell.
Click here to know how the company’s overall performance in the fiscal first quarter is expected to be.
RTG in the Spotlight
RTG consists of Spine, Brain Therapies, Specialty Therapies and Pain Therapies divisions.
The company is encouraged by robust and consistent constant currency growth in the RTG business over the last few quarters. This has been driven by a sustained momentum in the Brain Therapies division, banking on strong progress in both Neurovascular and Neurosurgery.
Medtronic PLC Price and EPS Surprise
Medtronic PLC price-eps-surprise | Medtronic PLC Quote
Within Neurovascular, we expect to see an uptick across Medtronic’s stroke franchise with growth in stent retrievers, flow diverters, coils, neuro access and embolic products. Within Neurosurgery, the company’s capital equipment performance should remain solid, boosted by a sturdy performance of StealthStation navigation, O-arm imaging, Mazor Robotics and Midas Rex powered surgical systems.
In this regard, following the company’s launch of Mazor X Stealth Edition robotics guidance platform in 2019, the company has been receiving a positive feedback on the same. This should add to the company’s Neurosurgery business’ top line in the yet-to-be-reported quarter.
Within Pain Therapies, in the quarter to be reported, Medtronic is expected to gain market share despite the market’s recent slowdown. In this regard, in the last reported quarter, the Pain Stimulation business achieved the number one share position for the first time in two-and-half years, driven by a solid uptake of the Intellis platform for spinal-cord stimulation. The Evolve workflow algorithm and Snapshot reporting are also aiding the company’s revenue stream.This should get reflected through the fiscal first-quarter results as well.
Within Spine, the U.S.core Spine businessis expected to benefit in the to-be-reported quarter. Spine implant sales should increase on the sturdy uptake of enabling technologies robotics, navigation, imaging and powered surgical instruments.
Medtronic currently expects 4-4.5% revenue growth in RTG business during fiscal 2019. For the fiscal first quarter, management anticipates a 3-3.5% revenue rise from the RTG business.
The Zacks Consensus Estimate for RTG revenues in the fiscal first quarter stands at $1.98 billion, implying a 10.8% decline from the last reported figure.
Zacks Rank & Key Picks
Medtronic currently carries a Zacks Rank #3 (Hold). Here are a few stocks with the right combination of elements to beat on earnings this reporting cycle.
The Cooper Companies, Inc. COO has an Earnings ESP of +1.50% and a Zacks Rank #2 (Buy). You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Premier, Inc. PINC has an Earnings ESP of +0.77% and is Zacks #3 Ranked.
Catalent, Inc. CTLT has an Earnings ESP of +1.56% and a Zacks Rank of 3.
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