Thread regarding Medtronic Inc. layoffs

Yahoo Financial Analyst Says

"Is Medtronic Making Efficient Use Of Its Profits?

With a high three-year median payout ratio of 87% (implying that 13% of the profits are retained), most of Medtronic's profits are being paid to shareholders, which explains the company's shrinking earnings. The business is only left with a small pool of capital to reinvest - A vicious cycle that doesn't benefit the company in the long-run."

"Summary

In total, we would have a hard think before deciding on any investment action concerning Medtronic. The company has seen a lack of earnings growth as a result of retaining very little profits and whatever little it does retain, is being reinvested at a very low rate of return."

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| 1621 views | | 6 replies (last March 19, 2024) | Reply
Post ID: @OP+1riMKKAL

6 replies (most recent on top)

What are E/E employees?

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Post ID: @khna+1riMKKAL

Dividend payout is greater than reinvestment in R&D. This is not a winning strategy.

Investment % of revenue is far below that of our competitors (all of them). Again, not a winning strategy.

Lastly, stock payouts/awards that are given to employees is less than many competitors. Often, those compensated are E/E employees, which are not always our best employees - they are always the favorite employees of a leader. Pay for value add is not the model the company employs, not a winning strategy.

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Post ID: @kvrg+1riMKKAL

BSC way up!

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Post ID: @2nre+1riMKKAL

“The problem is if we don’t raise the dividend after 47 years it will show what a bad path we on and there will be one more reason not to invest”

While true, it is short sighted thinking. It’s hard to patch holes in a ship while still at sea. At some point it needs to go into dry dock and get repaired. The same is true of a business, if there are foundational issues, it is difficult to fix them without having to take some medicine. While suspending the dividend would cause a massive stock price drop, it would also free up cash flow for investment back into the business in order to repair some of these foundational problems.

Easier said than done, because it would be focused on long term success/sustainability, while sacrificing the immediate term. All of which doesn’t benefit ExCom

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Post ID: @2jvn+1riMKKAL

The problem is if we don’t raise the dividend after 47 years it will show what a bad path we on and there will be one more reason not to invest.

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Post ID: @2lpd+1riMKKAL

Yup, S&P 500 is up +7.5% YTD in the last two months. MDT up only 0.6% lmao.

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Post ID: @1yoe+1riMKKAL

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