By: Eric Schopf

Medtronic PLC (Ticker: MDT) is a medical technology company that develops, manufactures, distributes and sells device-based medical therapies. The company serves healthcare systems, physicians, clinicians and patients in more than 150 countries. The company was founded in 1949 and employs over 90,000 people. Although Medtronic is headquartered in Dublin, Ireland, the company operates primarily in the United States.

Medtronic develops and manufactures devices and therapies to treat more than thirty chronic diseases including heart failure, Parkinson’s disease, urinary incontinence, Down syndrome, obesity, chronic pain, spinal disorders and diabetes. The company operates through four main divisions. The Cardiovascular segment addresses the diagnosis, treatment and management of cardiac rhythm disorders and cardiovascular disease. The Medical segment produces surgical products, including surgical stapling devices, vessel sealing instruments, wound closure, electrosurgery products, surgical artificial intelligence and robotic-assisted surgery products, hernia mechanical devices, mesh implants, as well as gynecology and lung products. The Neuroscience segment provides products for spinal surgeons, neurosurgeons, neurologists, pain management specialists, anesthesiologists, orthopedic surgeons, urologists, urogynecologists, interventional radiologists, ENT specialists and systems that incorporate energy surgical instruments. The Diabetes segment produces insulin pumps, continuous glucose monitoring systems and insulin pump consumables.

The global Covid-19 pandemic has negatively impacted Medtronic. Preventative and precautionary measures taken by businesses, communities and governments to mitigate the spread of the disease have led to deferrals, and in some cases, cancelations of medical procedures. Fewer procedures have resulted in lower demand for Medtronic products. Furthermore, some of MDT’s global suppliers, vendors and distributors have been adversely affected by employee absenteeism during the pandemic, resulting in product availability issues.

However, Medtronic has seen a rebound in elective procedures as the Omicron surge has waned. As a result of this news, coupled with a 25% decline in its stock price, we at Tufton have taken this opportunity to initiate positions at attractive levels. Also, MDT’s 2.5% dividend yield provides a solid level of income.