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Wire

Medtronic Completes Acquisition of Scientia Vascular

Medtronic (MDT) has completed its acquisition of privately held medical device company Scientia Vascular in a $550 million deal, plus potential milestone payments, the company said Friday.The deal strengthens its neurovascular business by integrating Scientia's guidewires and catheters with its existing portfolio to support the full procedural workflow, the company said.The company added the deal is expected to be minimally dilutive to adjusted earnings per share in fiscal 2027 and accretive thereafter.Price: $80.29, Change: $-0.05, Percent Change: -0.06%

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Wire

Medtronic Positioned for Potential Upside to Fiscal 2027 Guidance, RBC Capital Markets Says

Medtronic (MDT) could deliver upside to fiscal 2027 guidance as cardiac ablation, renal denervation, Hugo, Stealth AXiS, and Altaviva momentum support growth, RBC Capital Markets said in a note Wednesday.Medtronic beat fiscal Q4 estimates, delivering 6.6% organic revenue growth and adjusted earnings of $1.55 per share. Cardiac ablation solutions led the beat, with sales up 78% from a year earlier and US growth of 124%, the brokerage said.Management's fiscal 2027 guidance came in below consensus, but several growth drivers are improving at the same time, including renal denervation that analysts described as underappreciated, according to the note.The brokerage said it now models fiscal 2027 adjusted sales growth of 7.1% and adjusted earnings of $5.96 per share.RBC Capital Markets maintained its outperform rating and $118 price target on the stock.Shares of Medtronic were up more than 4% in Thursday trading.Price: $81.58, Change: $+3.63, Percent Change: +4.66%

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Research

BTIG Upgrades Medtronic to Buy From Neutral, Price Target is $90

Medtronic (MDT) has an average rating of overweight and mean price target of $98.22, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www..com/contact-us)

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Sectors

Sector Update: Healthcare Stocks Higher Late Afternoon

Healthcare stocks rose late Wednesday afternoon, with the NYSE Healthcare Index increasing 0.6% and the State Street Health Care Select Sector SPDR ETF (XLV) adding 0.8%.The iShares Biotechnology ETF (IBB) advanced 1.7%.In corporate news, Medtronic (MDT) reported better-than-expected fiscal Q4 results on Wednesday, while the medical-device maker projected earnings and organic revenue growth for the current year. Its shares gained 5.8%.BioNTech (BNTX) cautioned that proposed healthcare reforms in Germany, due for a vote this summer, may put future investments in the country at risk, Bloomberg reported, citing Chief Commercial Officer Annemarie Hanekamp. BioNTech shares fell 0.8%.TG Therapeutics (TGTX) said its subcutaneous formulation of ublituximab showed "positive" results from a phase 1 trial comparing the multiple sclerosis therapy to the drug's intravenous version. Shares jumped past 10%.Maia Biotechnology (MAIA) shares rose 4.4% after the firm said Wednesday it has received clearance from the US Food and Drug Administration to open enrollment for the expansion of a phase 2 trial of ateganosine for advanced non-small cell lung cancer.

$BNTX$MAIA$MDT$TGTX
Wire

Medtronic Q4 Organic Revenue Beat Driven by Cardiovascular, Medical Surgical Strength, Truist Says

Medtronic (MDT) reported fiscal Q4 organic revenue growth ahead of expectations amid strength in its Cardiovascular and Medical Surgical businesses, Truist Securities said in a note Wednesday.The brokerage said Medtronic posted 6.5% organic revenue growth excluding Diabetes and Other that topped consensus estimates. Cardiovascular and Medical Surgical revenue exceeded expectations.Truist noted that gross margin and operating margin were below expectations and elevated selling, general and administrative expenses weighed on profitability. Adjusted earnings per share of $1.55 exceeded estimates by $0.01 due to foreign exchange and non-operating items, according to the note.The brokerage said Medtronic's fiscal 2027 guidance for 6.75% to 7.25% organic revenue growth is broadly in line with expectations after adjusting for the benefit of an extra selling week.Guidance includes contributions from the Diabetes business, incorporates about $250 million of tariff-related costs, and does not assume any benefit from share repurchases related to the planned Diabetes spin-off.Truist maintained its hold rating and $95 price target on Medtronic.Shares of Medtronic were up 5.5% in Wednesday trading.Price: $77.79, Change: $+4.04, Percent Change: +5.48%

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Equities Fall Intraday, Oil Jumps Amid Renewed Middle East Tensions
US Markets

Equities Fall Intraday, Oil Jumps Amid Renewed Middle East Tensions

US benchmark equity indexes were lower intraday, while oil prices rose amid renewed hostilities in the Middle East.The Nasdaq Composite was down 1% at 26,816.5 after midday Wednesday, while the Dow Jones Industrial Average fell 0.9% to 50,858.1. The S&P 500 shed 0.6% to 7,562.9. The indexes logged fresh closing highs in the previous session.Among sectors, technology and consumer discretionary saw the biggest decline intraday Wednesday, while energy paced the gainers.Several major tech names were falling sharply, with IBM (IBM) down 6.1%, the steepest decline on the Dow. Salesforce (CRM), Microsoft (MSFT), and Nvidia (NVDA) followed IBM on the index.West Texas Intermediate crude oil was up 2.6% at $96.17 a barrel, while Brent rose 2.1% to $98.04."Crude oil is trading higher for a third consecutive session, with Brent pushing above $97 as market pessimism once again grows over the prospects of a US-Iran deal that could pave the way for a reopening of the Strait of Hormuz," Saxo Bank said in a report.Iran launched strikes targeting US bases in Kuwait and Bahrain, as well as a vessel near the Strait of Hormuz, CNN reported. On Tuesday, the US Central Command said it conducted self-defense strikes on Qeshm Island in response to attempted attacks by Iran across the Middle East.A barrage of ballistic missiles and drones hit Kuwait Wednesday, shutting its international airport, killing one person and injuring dozens, The Wall Street Journal reported.US President Donald Trump reportedly said in a podcast with the New York Post that Iran has agreed not to have nuclear weapons, but Tehran could still change its mind. Previously, Trump said that negotiations with Iran were continuing, despite Iranian state-affiliated outlet Tasnim reporting that the country had suspended talks with Washington."For now, the risk premium continues to be partly offset by President Trump's repeated insistence that an interim agreement remains within reach," Saxo said.In economic news, the Organization for Economic Co-operation and Development lowered its global economic growth projection for 2026, cautioning that the fallout from the Middle East conflict may linger for some time even after its resolution.In the US, employment in the private sector increased more than expected in May, ADP (ADP) data showed."The breadth of gains was encouraging, with almost all sectors increasing payrolls during the month," Oxford Economics said in a note. "Coupled with weak labor supply growth, the strong gains in payrolls would reduce the upside risk to the unemployment rate."Data from the Bureau of Labor Statistics are expected to show Friday that the US economy added 85,000 nonfarm jobs last month, which would represent a fall from a 115,000 increase reported for April, according to a Bloomberg-compiled survey. The unemployment rate is seen unchanged at 4.3%.The US services sector saw continued expansion in May, with Institute for Supply Management data showing a faster growth rate sequentially, but S&P Global (SPGI) pointing to a deceleration. Both surveys indicated elevated cost pressures and signs of weakness in the labor market."The combination of resilient demand and intensifying cost pressures reinforces the risk of ongoing price pass-through, suggesting that the (Federal Reserve) is likely to remain patient on policy easing given limited progress on services disinflation and increasing the likelihood of rate hikes this year," TD Economics said in a note.US Treasury yields were higher intraday, with the 10-year rate up 3.8 basis points at 4.49%, and the two-year rate rising 3.3 basis points to 4.08%.In company news, Medtronic (MDT) reported better-than-expected fiscal fourth-quarter results, while the medical-device maker projected earnings and organic revenue growth for the current year. The company's shares were up 5.1%, among the best performers on the S&P 500.Broadcom (AVGO), CrowdStrike (CRWD), Veeva Systems (VEEV) and Five Below (FIVE) are expected to report after the closing bell Wednesday, along with others.Gold was down 1.2% at $4,465.10 per troy ounce, while silver fell 2.6% to $73.58 per ounce.

Dow JonesNasdaq CompositeS&P 500$ADP$AVGO$CRM$CRWD$FIVE$IBM$MDT$MSFT$NVDA$SPGI$VEEV
Sectors

Sector Update: Healthcare Stocks Higher in Afternoon Trading

Healthcare stocks rose Wednesday afternoon, with the NYSE Healthcare Index increasing 0.7% and the State Street Health Care Select Sector SPDR ETF (XLV) adding 1%.The iShares Biotechnology ETF (IBB) advanced 1.4%.In corporate news, Medtronic (MDT) reported better-than-expected fiscal Q4 results on Wednesday, while the medical-device maker projected earnings and organic revenue growth for the current year. Its shares gained 5.4%.TG Therapeutics (TGTX) said its subcutaneous formulation of ublituximab showed "positive" results from a phase 1 trial comparing the multiple sclerosis therapy to the drug's intravenous version. Shares jumped past 11%.Maia Biotechnology (MAIA) shares rose 3.7% after the firm said Wednesday it has received clearance from the US Food and Drug Administration to open enrollment for the expansion of a phase 2 trial of ateganosine for advanced non-small cell lung cancer.

$MAIA$MDT$TGTX
Sectors

Sector Update: Healthcare

Healthcare stocks rose Wednesday afternoon, with the NYSE Healthcare Index increasing 0.7% and the State Street Health Care Select Sector SPDR ETF (XLV) adding 1%.The iShares Biotechnology ETF (IBB) advanced 1.4%.In corporate news, Medtronic (MDT) reported better-than-expected fiscal Q4 results on Wednesday, while the medical-device maker projected earnings and organic revenue growth for the current year. Its shares gained 5%.

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Wire

Top Midday Stories: Alphabet Upsizes Equity Capital Raise to $84.75 Billion; SpaceX Planning $135 a Share IPO

All three major US stock indexes were down late-morning Wednesday, as oil prices and US Treasury yields rose amid concerns about the ongoing conflict between the US and Iran.In company news, Alphabet (GOOG, GOOGL) upsized its equity capital raise to $84.75 billion from the previously announced $80 billion, according to a regulatory filing Tuesday. The offering includes a pledge by Berkshire Hathaway (BRK.A, BRK.B) to invest $10 billion in a private placement, the filing said. Alphabet's Class C and Class A shares were each down about 0.8%. Berkshire's Class A and Class B shares were up 0.3% and 0.5%, respectively.SpaceX plans to price its initial public offering at $135 per share, seeking to raise $75 billion, Reuters reported late Tuesday, citing people familiar with the matter. The firm plans to sell 555.6 million shares in an all-primary offering and is aiming for a $1.75 trillion valuation, the report said. Separately, 10 officials in the Trump administration reported financial interests in SpaceX and xAI worth at least $9.9 million and as much as $43.8 million, Bloomberg reported Wednesday, citing recent public financial disclosures.Hartford Insurance Group (HIG) has agreed to sell its Hartford Funds unit to Wellington Management in a deal with a net present value of $1.9 billion, the companies said Wednesday. Hartford will receive $300 million in cash at closing, with additional payments over seven years tied to cash generated by the combined business and related product sales, the companies said. Hartford shares were down 0.5%.Medtronic (MDT) reported fiscal Q4 adjusted earnings Wednesday of $1.55 per diluted share, down from $1.62 a year earlier but above the FactSet consensus analyst estimate of $1.54. Fiscal Q4 revenue was $9.81 billion, up from $8.93 billion a year ago and above the consensus of $9.62 billion. For fiscal 2027, the company expects adjusted EPS of $5.90 to $6.00 on organic revenue growth of 6.75% to 7.25%. Analysts polled by FactSet expect adjusted EPS of $6.05. Medtronic said it is investing in two privately held intracardiac echocardiography catheter companies. Financial details of the investments were not disclosed. Medtronic shares were up 4.6%.Palo Alto Networks (PANW) reported fiscal Q3 adjusted earnings late Tuesday of $0.85 per diluted share, up from $0.80 a year earlier and above the FactSet consensus of $0.79. Fiscal Q3 revenue was $3 billion, up from $2.29 billion a year ago and above the consensus of $2.94 billion. For fiscal Q4, the company said it expects adjusted EPS of $0.96 to $0.98 on revenue of $3.35 billion to $3.36 billion. Analysts polled by FactSet expect $0.94 and $3.28 billion, respectively. Palo Alto Networks shares were down 4.3%.Price: $355.43, Change: $-2.96, Percent Change: -0.83%

$GOOG$GOOGL$HIG$MDT$PANW
Medtronic Tops Fiscal Fourth-Quarter Estimates, Guides to Higher Full-Year Earnings
US Markets

Medtronic Tops Fiscal Fourth-Quarter Estimates, Guides to Higher Full-Year Earnings

Medtronic (MDT) reported better-than-expected fiscal fourth-quarter results on Wednesday, while the medical-device maker projected earnings and organic revenue growth for the current year.In the three months ended April 24, adjusted earnings fell to $1.55 a share from $1.62 a year earlier, topping the consensus of $1.54 in a FactSet survey. Revenue rose 9.9% to $9.81 billion, above analysts' estimate of $9.62 billion. On an organic basis, excluding currency and other items, sales gained 6.6%.Medtronic shares climbed 4.9% in Wednesday trading and are down 19% this year."We are pleased to have delivered results ahead of expectations on both revenue and EPS," Chief Financial Officer Thierry Pieton said in a statement. "As we look to (fiscal 2027), we are entering the year with strong momentum, a resilient operating foundation, and a clear path to deliver durable growth."For fiscal 2027, the company expected adjusted EPS of $5.90 to $6, reflecting growth of 6.7% to 8.5%. Analysts project EPS of $6.05. The company said foreign exchange should have a neutral to 1% accretive impact.Medtronic expects organic revenue to rise 6.8% to 7.3% for the full year, compared with 5.8% growth in fiscal 2026.Revenue in the cardiovascular portfolio climbed 14% to $3.8 billion in the fourth quarter, buoyed by a 22% increase in cardiac rhythm and heart-failure products. Neuroscience sales rose 5% to $2.75 billion, and medical surgical revenue advanced 8% to $2.39 billion. Diabetes revenue climbed 15% to $837 million, supported by growth in insulin-pump and sensor technologies.CEO Geoff Martha said the company continued to see strength across major businesses, including cardiac rhythm management, cranial and spinal technologies, and surgical, and is building momentum in its highest-growth opportunities.Price: $77.37, Change: $+3.62, Percent Change: +4.91%

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Sectors

Sector Update: Healthcare Stocks Mixed Premarket Wednesday

Healthcare stocks were mixed premarket Wednesday, with the iShares Biotechnology ETF (IBB) down 0.1% and the State Street Health Care Select Sector SPDR ETF (XLV) marginally higher.Medtronic (MDT) shares were up more than 5% after the company reported fiscal Q4 adjusted earnings and revenue that topped analysts' expectations.MiniMed (MMED) stock was up more than 4% after the company posted higher fiscal Q4 revenue.TG Therapeutics' (TGTX) subcutaneous formulation of ublituximab showed "positive" pharmacokinetic, pharmacodynamic, safety, and tolerability data from a phase 1 clinical trial comparing the multiple sclerosis therapy to the drug's intravenous version, the company said.Shares of TG Therapeutics were up more than 5% pre-bell.

$IBB$MDT$MMED$TGTX$XLV
Sectors

Sector Update: Health Care

Healthcare stocks were slightly lower premarket Wednesday, with the iShares Biotechnology ETF (IBB) down 0.1% and the State Street Health Care Select Sector SPDR ETF (XLV) down 0.2%.Medtronic (MDT) shares gained more than 6% after the company reported fiscal Q4 adjusted earnings and revenue that topped analysts' expectations.

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Research

Research Alert: Mdt Posts Solid Fy 26; Margin Pressures Persist, Eps Guidance Disappoints

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:MDT posted Q4 FY 26 (Apr.) revenue of $9.8B (+9.9% reported, +6.6% organic), beating consensus by $194M, while non-GAAP EPS of $1.55 beat the consensus view by $0.01 but declined 4.3% Y/Y. The Cardiovascular Portfolio delivered solid 13.8% Y/Y growth to $3.8B in Q4, led by Cardiac Ablation Solutions sales surging 78% globally, reflecting rapid adoption of pulsed field ablation technologies. However, FY 27 guidance disappointed with non-GAAP EPS of $5.90-$6.00 below consensus at the midpoint of $5.95. Regulatory milestones including FDA submissions for Hugo robotic surgery system and CathWorks acquisition completion could advance growth, in our view. We think the active M&A strategy with Scientia Vascular and SPR Therapeutics acquisitions could complement organic innovation and boost revenues. While MDT could continue solid top-line performance with its robust pipeline and market positions, we believe margin pressures from rising costs, supply chain challenges, and tariffs could negatively impact profitability.

$MDT
Stocks Mostly Down Pre-Bell as Traders Assess Latest Middle East Developments
US Markets

Stocks Mostly Down Pre-Bell as Traders Assess Latest Middle East Developments

The main US stock measures were mostly trending lower in Wednesday's premarket activity as traders assess the latest developments in the Middle East.The S&P 500 edged down 0.1% and the Dow Jones Industrial Average declined 0.4%, while the Nasdaq gained 0.2% before the opening bell. All three indexes recorded new closing highs on Tuesday.President Donald Trump said in a podcast interview that Iran has agreed not to have nuclear weapons, several media outlets reported Wednesday. In a social media post on Tuesday, Trump said negotiations between the US and Iran were "going on continuously."Earlier in the week, Iranian state-affiliated outlet Tasnim reported that the country suspended talks with the US in retaliation to Israel's military action in Lebanon.The US Central Command said Tuesday that its forces "successfully defeated" multiple Iranian ballistic missiles and drones and launched defensive strikes following "attempted attacks" by Tehran across the Middle East.Iran reportedly launched a wave of missile and drone attacks toward Kuwait and Bahrain in a major escalation of regional tensions. Kuwait said a number of "hostile drones" targeted its airport, causing significant material damage and injuring several people.West Texas Intermediate crude oil increased 2.6% to $96.17 a barrel in premarket action, while Brent advanced 2.5% to $98.42."Crude oil continues to trade from one headline to the next, making it increasingly difficult for traders to maintain conviction beyond a few hours," Saxo Bank said in a Tuesday report. "Global energy markets continue to tighten, with the main focus remaining on the Strait of Hormuz, a vital shipping artery that remains effectively shut, sustaining concerns about supply disruptions and elevated energy prices."Treasury yields were up before the open, with the two-year rate rising 2.9 basis points to 4.08% and the 10-year rate adding 3 basis points to 4.49%.The Organization for Economic Cooperation and Development on Wednesday cut its global growth outlook for 2026, warning that a prolonged war between the US and Iran could have "longer-lasting negative consequences."The ADP Employment report for May is out at 8:15 am ET. On Tuesday, official data showed that US job openings hit their highest level in almost two years in April, while hiring and layoffs fell.Wednesday's economic calendar also has the weekly mortgage applications bulletin at 7 am. The purchasing managers' index composite final report from S&P Global (SPGI) for May posts at 9:45 am, followed by the Institute for Supply Management's services index for the same month at 10 am.The weekly EIA domestic petroleum inventories report is due at 10:30 am. The Federal Reserve's Beige Book, a compilation of economic and business reports from the 12 regional Fed branches, is out at 2 pm.Fed Governor Michael Barr is scheduled to speak at 9 am, while Dallas Fed President Lorie Logan speaks at 4 pm.The Fed may need to raise interest rates should inflationary pressures persist, Cleveland Fed President Beth Hammack said Tuesday. "If we wait for definitive evidence that high inflation has become embedded in the economy, it may require larger policy adjustments, at greater cost," Hammack said in prepared remarks for an event in Ohio.Shares of Palo Alto Networks (PANW) declined 3.7% pre-bell following the company's latest quarterly results. Marvell Technology (MRVL) climbed 14% after Nvidia (NVDA) Chief Executive Jensen Huang reportedly said the company could be the next chip manufacturer to join the trillion-dollar club.Broadcom (AVGO), CrowdStrike (CRWD), Veeva Systems (VEEV) and Five Below (FIVE) are expected to release their latest earnings after the markets close. Medtronic (MDT), Macy's (M), Ollie's Bargain Outlet (OLLI) and Thor Industries (THO) post their financial results before the bell, among others.Gold slipped 0.7% to $4,488 per troy ounce, while bitcoin inched 0.3% higher to $67,127.

Dow JonesNasdaq CompositeS&P 500$AVGO$CRWD$FIVE$M$MDT$MRVL$OLLI$PANW$THO$VEEV
Wire

Medtronic Expected to Beat Fiscal Q4 Estimates Amid New Product Launches, Needham Says

Medtronic (MDT) is expected to beat revenue and earnings estimates for its fiscal Q4, driven by new product launches, healthy market growth and conservative company guidance, Needham said in a note on Wednesday.The brokerage said it expects Medtronic's fiscal 2027 revenue and EPS guidance to bracket consensus estimates when the medical device maker reports results on June 3.Needham said Medtronic is in the early stages of a strong product cycle led by its Affera pulsed field ablation system, Symplicity Spyral renal denervation platform and Hugo robotic surgery system, which could help accelerate organic revenue growth.The firm also said Medtronic may announce restructuring actions as it looks to improve efficiency, citing recent reports of layoffs and facility closures.Needham maintained its buy rating and $120 price target.Price: $76.16, Change: $-1.44, Percent Change: -1.86%

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Sectors

Sector Update: Healthcare Stocks Mixed Late Afternoon

Healthcare stocks were mixed late Wednesday afternoon, with the NYSE Healthcare Index up 0.1% and the State Street Health Care Select Sector SPDR ETF (XLV) down 0.2%.The iShares Biotechnology ETF (IBB) rose 1.9%.In corporate news, Cigna (CI) shares fell 2.5% after Deutsche Bank downgraded the stock to hold from buy and cut its price target to $302 from $303.Medtronic (MDT) said Wednesday it is planning to acquire medical technology firm SPR Therapeutics for an upfront cash payment of about $650 million. Shares were down 0.8%.Personalis (PSNL) shares jumped 12% after the company said its NeXT personal minimal residual disease test has been approved for expanded coverage by the US Centers for Medicare & Medicaid Services' Molecular Diagnostic Services Program.Immunovant (IMVT) shares surged 35% after the firm said its cash and cash equivalents were about $902.1 million as of March 31, providing runway for announced indications through the potential commercial launch of IMVT-1402 in Graves' disease.

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Sectors

Sector Update: Healthcare Stocks Decline in Afternoon Trading

Healthcare stocks were lower Wednesday afternoon, with the NYSE Healthcare Index decreasing 0.3% and the State Street Health Care Select Sector SPDR ETF (XLV) shedding 0.2%.The iShares Biotechnology ETF (IBB) rose 1.9%.In corporate news, Medtronic (MDT) said Wednesday it is planning to acquire medical technology firm SPR Therapeutics for an upfront cash payment of about $650 million. Medtronic shares were down 1%.GSK (GSK) said Wednesday it has started negotiations with the pan-Canadian Pharmaceutical Alliance for the use of Blenrep to treat adults with relapsed or refractory multiple myeloma, a type of blood cancer. GSK shares were fractionally higher.Immunovant (IMVT) shares surged 33% after it said Wednesday its cash and cash equivalents were about $902.1 million as of March 31, providing runway for announced indications through the potential commercial launch of IMVT-1402 in Graves' disease.

$GSK$IMVT$MDT
Sectors

Sector Update: Healthcare

Healthcare stocks declined Wednesday afternoon, with the NYSE Healthcare Index decreasing 0.3% and the State Street Healthcare Select Sector SPDR ETF (XLV) shedding 0.5%.The iShares Biotechnology ETF (IBB) rose 1.8%.In corporate news, Medtronic (MDT) said Wednesday it is planning to acquire medical technology firm SPR Therapeutics for an upfront cash payment of about $650 million. Medtronic shares were down 1.2%.

$MDT
Wire

Medtronic to Acquire SPR Therapeutics for $650 Million

Medtronic (MDT) said Wednesday it is planning to acquire medical technology firm SPR Therapeutics for an upfront cash payment of about $650 million.The acquisition will allow Medtronic to provide more pain relief options earlier in the care continuum, according to a statement.The deal is expected to close within H1 of Medtronic's fiscal year, which started on April 25, the company said.Price: $77.66, Change: $-0.91, Percent Change: -1.15%

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Research

Research Alert: CFRA Lowers Rating On Shares Of Medtronic Plc To Hold From Buy

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We cut our target to $83 from $118, 13.7x our FY 27 (Apr.) EPS view, below MDT's 10-year historical forward average of 17.6x. We trim our FY 26 EPS estimate to $5.52 from $5.65 due to lower profitability expectations and MiniMed IPO dilution. We cut our FY 27 view to $6.06 from $6.11. We downgrade shares to Hold from Buy following a mixed Q1 MedTech earnings season, with divergent performances across companies and multiple near-term headwinds, including margin pressures from rising raw material costs, supply chain challenges, and tariffs, which we think can also impact MDT. Adding to these pressures, MDT announced (May 11) the closure of its Santa Rosa, CA facility, which faced a $381M antitrust verdict in February. Also, the China business (~10% of total revenue) has been facing challenges from aggressive anti-corruption campaigns targeting health care and government volume-based procurement policies, triggering steep price cuts on medical devices, with limited near-term visibility on normalization.

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