Buffett Brain · Research note
Score updated 5 Oct 2026
MDT· Healthcare
Medtronic
Medtronic's strong operating margin in a competitive sector is offset by a high valuation and below-sector ROIC.
Buffett fit
Weak fit
Owner
44
Durability
87
Management
84
Price
35
Score updated 5 Oct 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Healthcare stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If we owned 100% of Medtronic, we'd focus on maintaining its strong of 18.78%, which is top-quintile in its sector.
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Medtronic has been profitable for the past 5 years, with an EPS CAGR of 13.22%, indicating durable earnings growth.
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Medtronic's share count has decreased at a CAGR of -1.54% over the past 5 years, reflecting disciplined through .
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At a of 25.1 and an earnings yield of 3.99%, Medtronic appears overvalued relative to a 'no-brainer' entry point of 8-10% owner-earnings yield.
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- The full reasoning behind all four pillars
- The 5-year price target and the return it implies
- What would change the call
- Graham, Lynch and Greenblatt on the same stock
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1 of 18.78% is top-quintile in the healthcare sector.
- 2Net margin of 13.2% is also top-quintile, indicating strong profitability.
- 3 of $5.43B exceeds net income, with an FCF/Net Income ratio of 1.13.
- 4Interest coverage of 9.6 suggests strong ability to service debt.
Concerns
5- 1 of 7.17% is below the sector's top-quintile threshold of 10.7%.
- 2Net debt/EBITDA of 2.65 exceeds the typical Buffett comfort zone.
- 3 of 25.1 and EV/ of 21.4 indicate a high valuation.
- 4 yield of 4.5% is below the ideal 8-10% range.
Price history
$86.38-31.0%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Medtronic plc develops and sells medical devices across cardiovascular, neuroscience, and medical surgical segments. The company generated $36.36B in revenue, with a of 65.02%. Its of 18.78% is top-quintile in the healthcare sector, indicating efficient operations. The unit economics are supported by a net margin of 13.2%, showing profitability across its product lines.
How this analysis has moved
The call has held across 2 reviews.
Sep 27, 2026 → Oct 4, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Healthcare
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