Medtronic stock poised to rise as CMS proposes broader renal denervation coverage

Investing.com - Medtronic , Inc. (NYSE:MDT) is expected to trade higher following the Centers for Medicare & Medicaid Services' (CMS) proposed decision memo for renal denervation (RDN) treatment for uncontrolled hypertension, according to Leerink Partners.

Leerink Partners reiterated an Outperform rating and $110.00 price target on Medtronic stock, noting that the CMS decision represents an important catalyst for investors. This target aligns with the broader analyst consensus, as InvestingPro data shows analyst targets ranging from $78 to $112.45. The proposed reimbursement appears broader than initially anticipated, with fewer restrictions than analysts had expected.

The research firm had previously anticipated CMS would restrict initial reimbursement to more uncontrolled, resistant patients as a cost-control measure, but the proposed coverage appears to encompass a wider patient population.

From a commercial perspective, Leerink Partners indicates that medical key opinion leaders expect significant demand from both institutions and patients for renal denervation once CMS reimbursement takes effect in October, based on the market size and early treatment experiences.

The research firm maintains its positive outlook on Medtronic, suggesting that the ongoing transformation at the company could create meaningful upside potential for the stock. With a GOOD financial health score and strong market position as reflected in its $114.55B market cap, Medtronic shows promising fundamentals. For deeper insights into Medtronic's valuation and growth prospects, InvestingPro offers a comprehensive Pro Research Report with detailed analysis of over 30 key metrics and expert insights.

In other recent news, Medtronic has announced several significant developments. The company plans to spin off its diabetes business into a new entity named MiniMed, reviving the original name of a company it acquired in 2001. This move is part of Medtronic's strategy to streamline operations and is expected to be completed within 18 months, subject to customary conditions. The diabetes unit, which makes up about 8% of Medtronic's total revenue, focuses on technologies for diabetes management. Additionally, RBC Capital reiterated its Outperform rating on Medtronic, highlighting the company's potential in the renal denervation market, which could be a multi-billion-dollar opportunity. The firm emphasized Medtronic's first-mover advantage in this area, pending a crucial reimbursement decision by the Centers for Medicare & Medicaid Services. Evercore has also added Medtronic to its TAP Outperform list, citing favorable conditions for MedTech companies. Furthermore, Medtronic appointed Dr. Joon Lee, CEO of Emory Healthcare, to its Board of Directors, effective June 18, 2025. Lastly, Needham analysts maintained a Hold rating on Medtronic stock, indicating that while the diabetes business separation might not unlock immediate value, it could enhance shareholder value in the long term.

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