Medtronic (NYSE:MDT) and Abbott Labs (NYSE:ABT) are massive companies with their corporate fingers in many different markets. However, each has recently launched revolutionary diabetes devices that are changing how doctors care for their patients. Are these two stocks buys?

In this clip from The Motley Fool's Industry Focus: Healthcare, host Kristine Harjes is joined by Motley Fool contributor Todd Campbell to explain how continuous glucose monitors and insulin pumps are improving patient lives.

A full transcript follows the video.

This video was recorded on May 23, 2018.

Kristine Harjes: Let's start with the goliath of today's discussion, which is Medtronic. The ticker is MDT. They're a huge company, a $115 billion market cap. To be clear, they are not a pure-play in diabetes. They're also working in cardiovascular and pain and surgery and a bunch of other areas. But, they do have a diabetes segment.

Todd Campbell: Right, and that diabetes segment doesn't represent a huge amount of the company's revenue, but there is some pretty exciting stuff going on at Medtronic in diabetes that's making that segment a bigger driver of the company's quarter-to-quarter performance.

Medtronic has long participated in what's called the continuous glucose monitor market, the CGM market. You mentioned there were two ways, two medical devices, that were getting more increasingly used by patients to evaluate and control their disease. One of those two is the continuous glucose monitors. They've always been a participant within that marketplace.

But, what happened in 2017 is that they won FDA approval for something called the MiniMed 670G. The 670G is the first "closed-loop" artificial pancreas system that the FDA has signed off on. Essentially, what we're talking about there is a system that will automatically evaluate your blood sugar levels by testing every five minutes, and then, as necessary, automatically administer insulin to help to keep that blood sugar in check.

Harjes: Which is really a pretty cool development. You think about going from the single point-in-time finger pricks, and then evolving the care to a CGM. Picture a sine curve, for my math nerds out there, where you can actually see that your levels are rising and falling, and watch that trend over time. That's even more complete information. Then, with this what they're calling artificial pancreas, that's a step even beyond the information of the CGM. Now, it's actually taking action on it, too, and adjusting insulin in response to that information. That is a huge step forward for convenience and timeliness of reacting to the data.

Right now, there are about 20,000 patients that are using this device, which was approved back in September 2016. And it should probably begin to gather even more use.

Campbell: Yeah. I've polled some of my friends who are diabetics -- this is a type 1 diabetes solution, primarily, because those are the people who are going to need to be managing the disease most intensely -- and they tend to prefer some of the other options we're going to talk about right now over this. But I think, over time, as the technology evolves and these systems get easier on the patient to use, etc, I think you'll see more and more patients using this.

You have 1.5 million Americans alone with type 1 diabetes. So, 20,000 patients worldwide using it, you don't have a huge amount of penetration. Nevertheless, it was still responsible for Medtronic's diabetes revenue growing by double digits year over year in Q1. Now, they didn't break out the exact sales of the MiniMed 670G. But what they did say is that diabetes segment sales in Q1 were $584 million. Which is pretty good. But, remember, Medtronic's sales in Q1 were $7.4 billion. So, if you're looking for a pure-play in diabetes, this isn't going to be it.

Harjes: Right. Another stock that's also not going to be your pure-play but is interesting to talk about in this space is Abbott. Their ticker is ABT. It's another huge company. They're over $100 billion. Again, they have a diabetes segment that's just one part of the larger company. Abbott, I believe, doesn't even break out their diabetes revenue, it just falls into the Other bucket for them. That Other bucket, for context, was a total of $430 million in revenue out of a total of $7.4 billion in the last quarter. So, again, they're only dealing with this market a little bit relative to the entire business, but they're still doing some interesting things.

They have their FreeStyle Libre, which was the first CGM that was approved that didn't require additional finger pricks for calibration of the system. When this came out, it was pretty revolutionary. We're going a little bit out of order here, because the next stock that we want to talk about is the stock that created the first CGM. But, I will leave you in suspense for which company that was, if you don't already know. When Abbott came out with its system, the stock that made the original CGM took a beating.

Campbell: Yeah. One of the big knocks against CGMs, these continuous glucose monitors, has been that they still require the finger sticks for calibrating them regularly. That's why, when the FDA approved the FreeStyle Libre from Abbott last year, it was such a big and intense and wonderful development for patients. As a result, that's turned into quite a commercial opportunity for Abbott.

Most of our listeners would probably be familiar with Abbott if they're income investors, because Abbott has a very long track record of -- as a matter of fact, it's a dividend aristocrat -- increasing its dividend every year. They don't necessarily think about Abbott for the diabetes business. But maybe that will change, because since they launched the FreeStyle Libre, in Q1 alone, their diabetes revenue grew 30% year over year. That's remarkable growth for a medical device segment of this size. Now, granted, again, like Medtronic, a very small proportion of the overall pie here at Abbott. But still an intriguing stock to keep an eye on.

Kristine Harjes has no position in any of the stocks mentioned. Todd Campbell has no position in any of the stocks mentioned. The Motley Fool owns shares of Medtronic. The Motley Fool has a disclosure policy.