Thursday, December 8, 2016

Recent Buy: Medtronics


Today on December 8, 2016, I bought 50 shares of Medtronics at $71.89 for a total of $3.601.35.

Description

Medtronic plc manufactures and sells device-based medical therapies worldwide. The company’s Cardiac and Vascular Group segment offers pacemakers, implantable cardioverter defibrillators and cardiac resynchronization therapy devices, AF products, diagnostics and monitoring devices, and remote monitoring and patient-centered software; and heart valves, percutaneous coronary intervention stent products, surgical valve replacement and repair products, endovascular stent grafts, peripheral vascular intervention products, and products to treat superficial and deep venous diseases. 

Rationale: Rewards>risk

  1. Yield 2.4%
  2. Payout ration: 53% 
  3. P/E
    1. TTM: 23.95x
    2. Forward: 14.27x
  4. Why is it down? 
    1. From buying Covidien. 
    2. And slowing down of rising price of medical reimbursement. 
  5. Fair Value or discount?
    1. Simply Wall St 
      1. Fair value: $87.82
    2. S&P capital: 
      1. 4 star buy, 
      2. fair price $86. 
      3. One year target $87.
    3. Thompson Reuters: 
      1. Neutral 4 buy, 
        1. Low: $80
        2. Mean: $85.5
        3. High: 96
    4. Edward Jones: 
      1. Buy rating
      2. Fair Value: $80.58
    5. Yahoo Finance:
      1. One year target: $85.50
Tax issue

"Beginning with the dividend payable on April 15, 2015, payments will be subject to an Irish withholding tax of 20% of the amount of each dividend unless the shareholder that is beneficially entitled to the dividend is a resident of the United States or a resident of a country listed as a “relevant territory”, and has ensured that the required information is on file with their broker, bank, qualifying intermediary or transfer agent (see below for more detail). With these rules, the vast majority of Medtronic shareholders and beneficial owners are entitled to an exemption from DWT."

This increased my forward dividends by $76.00 to $1,374.42. My next buy will probably be more UL or another 50 shares of MDT at $70 to complete my position. I also have a 100 share buy order on JNJ at $100. If the JNJ buyout goes through we might see that $100 again. 

Disclaimer: these are my opinions. Also updated my portfolio page. I really need to learn how to do that google docs thing. 

2 comments:

  1. Awesome buy. I need to get some medical companies over the next couple of years.

    ReplyDelete
    Replies
    1. hi DnH, ABT and MDR are two of the best medical device companies. I am buying on the market rotation. JNJ is another one to take a look at if it can reach 100.

      thanks for visiting

      Delete