Should You Avoid Medtronic Inc. (MDT)?

The majority of analysts covering Medtronic have a ‘Buy’ rating on the stock, while their average 12-month price target amounts to $87.50. The shares of Medtronic are currently trading nearly 16-times expected earnings, as compared to the forward P/E of 14.8 for the Healthcare sector. It should also be noted that in October 2015, Medtronic Inc. (NYSE:MDT)’s Coronary & Structural Heart division, which accounted for approximately 11% of net sales in the nine months that ended December 29, acquired privately-held medical device company Twelve Inc. for roughly $472 million. The freshly-acquired company was focusing on the development of a transcatheter mitral valve replacement device. Therefore, this acquisition will most likely drive up Medtronic’s top-line growth in the upcoming years.

With all of this in mind, let’s take a look at the fresh action regarding Medtronic Inc. (NYSE:MDT).

What have hedge funds been doing with Medtronic Inc. (NYSE:MDT)?

Heading into 2016, a total of 57 of the hedge funds tracked by Insider Monkey held long positions in this stock, a decline of 2% from the third quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Doug Silverman and Alexander Klabin’s Senator Investment Group has the number one position in Medtronic Inc. (NYSE:MDT), worth close to $307.7 million, amounting to 3.8% of its total 13F portfolio. Sitting at the No. 2 spot is Diamond Hill Capital, managed by Ric Dillon, which holds a $264.3 million position; 1.8% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors with similar optimism encompass Phill Gross and Robert Atchinson’s Adage Capital Management, Ken Griffin’s Citadel Investment Group and Jean-Marie Eveillard’s First Eagle Investment Management.