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The news is seen as a “major milestone” as it can “stop the bleeding in MDT’s diabetes business because the feedback on the algorithm is very positive,” Wells Fargo analysts said in a note.
The analysts upgraded MDT shares to Overweight with the price target raised to $100 per share from the prior $77.
“We think (1) MDT will benefit from an improvement in the underlying medtech markets; (2) the pipeline is improving; and (3) valuation appears attractive,” the analysts wrote.
Similarly, Barclays analysts upgraded the stock to Overweight from Equal Weight as the approval “helps clear the path forward for MDT.”
The approval also “provides a favorable outcome to one of the issues keeping us on the sidelines,” they wrote in the upgrade note.
“We expect the stock to react positively to the news, and with F4Q results F24 outlook ~4 wks away, we think it’s time to get more constructive on the stock.”
