Medtronic Plc

Analyst Listing

The following analysts provide coverage for the subject firm as of May 2016:

Broker Analyst Analyst Email
William Blair Ben Andrew bandrew@williamblair.com
Piper Jaffray Brooks E. West brooks.e.west@pjc.com
SunTrust Robinson Humphrey Bruce Nudell bruce.nudell@suntrust.com
Leerink Partners Danielle Antalffy danielle.antalffy@leerink.com
RBC Capital Markets Glenn Novarro glenn.novarro@rbccm.com
BMO Capital Markets Joanne K. Wuensch joanne.wuensch@bmo.com
Cowen & Company Joshua Jennings josh.jennings@cowen.com
Deutsche Bank Research Kristen Stewart kristen.stewart@db.com
Wells Fargo Securities Larry Biegelsen lawrence.biegelsen@wellsfargo.com
Credit Suisse Matthew Keeler matthew.keeler@credit-suisse.com
Needham Mike Matson mmatson@needhamco.com
Jefferies Raj Denhoy rdenhoy@jefferies.com
Stifel Nicolaus Rick Wise wiser@stifel.com
BTIG Sean Lavin slavin@btig.com
Oppenheimer Steven Lichtman steven.lichtman@opco.com
Wedbush Securities Tao Levy tao.levy@wedbush.com
Evercore ISI Vijay Kumar vijay.kumar@evercoreisi.com

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Primary Input Data

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Derived Input Data

Derived Input

Label

2015 Value

2016
Value

Equational Form

Net Operating Profit Less Adjusted Taxes NOPLAT 3,073  3,930 NOPLAT\, =\, EBIT\, x\, (1 \,-\, Avg \,\,Tax\,\, Rate\,\, on\,\, EBIT)
Free Cash Flow FCF 4,893 5,086 FCF\,=NOPLAT\,+\,Non-Cash\,Expenses-\Delta NWC\,-\,NCS
Tax Shield TS 319 93 TS\,=\,Interest\,\,Paid\,\,x\,\, Avg \,\,Tax\,\,Rate\,\, on\,\, Pre-Tax\,\, Income
Invested Capital IC 94,279 86,206 IC\,=\,Fixed\,\,Operating\,\,Assets\,\,+\,\,Net\,\, Working\,\, Capital
Return on Invested Capital ROIC 3.26% 4.56% ROIC\,=\,\frac { NOPLAT }{ IC }
Net Investment NetInv  51,896 (5,171) NetInv\,=\,{ {IC}_{1}}-{{IC}_{0}}+Depreciation
Investment Rate IR 1,688.66%  -131.59% IR\,=\,\frac {NetInv}{NOPLAT}
Weighted Average Cost of Capital
WACCMarket  11.28% 11.21% WACC\,=\,\frac { E }{ V } { R }_{ E }\,+\,\frac { P }{ V } { R }_{ P }\,+\,\frac { D }{ V } { R }_{ D }\left( 1- Avg\,\, Tax\,\,Rate\,\,on\,\,Pre-Tax\,\,Income \right)
 WACCBook     7.72%   7.37%
Enterprise value
EVMarket  120,707 125,018 EV\,=\,Market\,\,Cap\,\,Equity\,+\,\,Long\,\,Term\,\,Debt\,-\,Cash
 EVBook    128,660   118,471
Long-Run Growth
g = IR x ROIC
   55.04%   -6.00% Long-run growth rates of the income variable are used in the Continuing Value portion of the valuation models.
g = % \Delta GDP    2.50%   2.50%
Margin from Operations M    23.34%   20.67% M\,\,=\,\,\frac{EBIT}{SALES}
Depreciation/Amortization Rate D    21.64%   32.43% D\,\,=\,\,\frac{D+A}{EBITDA}

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Valuation Multiple Outcomes

The outcomes presented in this study are the result of original input data, derived data, and synthesized inputs.

Equational Form

Observed Value

Single-stage

multiple g solution

Two-stage valuation

model g solution

12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016

EV/SALES 

\frac {EV}{Sales} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(M)

 5.96  4.27  39.91%  25.98%  30.72%  19.59%

EV/EBITDA

\frac {EV}{EBITDA} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(1\,-\,D)

20.00 13.97 39.91% 25.98%  30.72% 19.59%

EV/NOPLAT

\frac {EV}{NOPLAT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}

39.28 31.81 39.91% 25.98%  30.72% 19.59%

EV/FCFOPS

\frac {EV}{FCF_{OPS}} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

24.67 24.58 39.91% 25.98%  30.72%  19.59%

EV/EBIT

\frac {EV}{EBIT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

35.53 20.68 39.91% 25.98%  30.72% 19.59%

EV/IC

\frac {EV}{IC} \,= \,\frac{ROIC\,  -\,  g}{WACC\,-\,g}

1.28 1.45 39.91% 25.98%  30.72% 19.59%

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