Medical apparatus manufacturer Medtronic (NYSE: MDT) posted flat first-quarter revenues but saw its earnings fall marginally. However, the company managed to meet Street expectations and its shares jumped 6%.

Revenue for the quarter grew 7% to $4.04 billion; however, if we take the favorable currency out of the equation, it only grew a meager 2%. The company reported 25% growth in revenue from emerging markets like China and the Middle East, but falling demand for Medtronic’s heart defibrillators and spinal products in the U.S. market offset much of that growth. Still, operating income jumped 9% to $1.18 billion in the quarter.

The company has taken steps to bounce back in the U.S. market through its improved ICD Protecta. It saw sales of its spinal devices decline after a medical journal was highly critical of Medtronic’s Infuse, and the company expects this segment to go down further. However, Medtronic is upbeat about its prospects outside the U.S., as its international revenue accounted for 46% of total sales.

The company has been a regular dividend payer and is inclined toward returning cash to its shareholders. In fact, Medtronic’s dividend yield of 2.8% stands a cut above peers Stryker (NYSE: SYK), Baxter (NYSE: BAX), and St. Jude Medical (NYSE: STJ). A low payout ratio of 32% and 33-year history of dividend increases should give investors added confidence in this dividend dynamo.

The Foolish takeaway
The main sticking point for Medtronic is weak demand in the U.S. Apart from that, the company is doing well to diversify itself both in terms of product innovation and geographical expansion, and looks set for a good year ahead.

To stay in touch with the latest developments on Medtronic, add it to My Watchlist.