By Geoffrey Smith
Investing.com -- Medtronic (NYSE:MDT) stock rose in premarket trading on Tuesday after the maker of medical devices promised solid organic sales growth and "aggressive" cost reductions to juice earnings.
The company said it expects organic revenue growth of between 4.5% and 5% in the current quarter, the last of a fiscal year that ends in April.
It also expects adjusted earnings per share to rise to around $1.56, after three quarters of flat or falling earnings. That forecast was still a little below consensus forecasts of $1.59.
In the three months through January, Medtronic said revenue fell by 0.5% and adjusted EPS fell by 4.4%, with the dollar's strength hurting revenue in developed markets outside the U.S. Revenue fell in both China and Japan in the quarter.
The group expects foreign exchange factors to shave 9c off the current quarter's earnings, and 21c off full-year earnings.
Medtronic, whose figures have been distorted in recent years by the shift in medical equipment spending required by the pandemic, said its business divisions are now seeing various headwinds abate, with ventilator sales improving and product availability in its Surgical Innovation and Cardiac Diagnostics divisions improving as supply chain disruptions ease.
Revenue grew by 7% in the three months through January at both its Cardiovascular and Neuroscience operations, while its Diabetes division grew a more sedate 3%, with U.S. declines offset by international growth. The group continues to generate nearly 60% of its revenue in the U.S.
By 07:45, Medtronic stock was up 2.2% in premarket trading.