What Medtronic actually does
Medtronic makes medical technology: pacemakers and heart devices, spinal and brain implants, surgical tools and robotics, and diabetes devices such as insulin pumps. It was founded in 1949 in Minnesota, and its legal home is now Ireland, while a large part of its operations remains in the US.
How the business makes money
It sells devices to hospitals and clinics, often with follow-up supplies and service. Doctors who learn to use a device usually keep using it, and many products are covered by insurance, which makes demand relatively steady.
The dividend story
Medtronic is a Dividend Aristocrat, with more than 45 years of annual increases, paid quarterly. The yield is moderate to high for a health care company, and growth in the raises has been modest recently.
What to keep an eye on
- Product issues. Recalls and safety problems can hit sales.
- Reimbursement. Insurers decide what they pay for.
- Innovation. Rivals can take share with better devices.
- Portfolio changes. The company has been reshaping its diabetes business.
Quick take
Medtronic is a defensive device maker with a long record of dividend increases. Growth is steady rather than fast.