Medtronic, Inc (MDT)
Medtronic’s founder Earl Beckken created the first wearable, battery powered pacemaker. Over 50 years later, Medtronic is still the #1 producer of pacemaker devices with a commanding market share in the industry. As an investor, pacemakers are what we might call a non-discretionary item especially as further research shows that pacemakers improve the death rates of even more milder cases of heart disease. It’s an important product and owning the top company in the field is a nice company to own.
With that said, the market is definitely fairly saturated and massive growth is likely in the past. Moreover, insurance companies and government pressure on the medical field could restrict pricing on medical devices. This is definitely a risk.
While pacemakers it the biggest business for Medtronic, they also have a number of other business areas and products. Spinal products, vascular products, diabetes products, and surgical technologies are some of the other areas contributed to Medtronic sales.
Approximately 40% of sales for Medtronic are coming outside the U.S. which is always a positive (especially considering the weak dollar). Side note: You’ll notice most companies I invest in have healthy international sales.
Management has a 38 year track record of increasing dividend payouts to investors. This is excellent.
I’m aiming to buy MDT under $35 / share, and am also considering participating in the DRIP program for this company. Large bulk share purchases are definitely warranted under $30 / share.