Medtronic (MDT -1.51%) is not new to innovation. The medical device giant sells a broad range of cutting-edge products, such as the Hugo robotic surgery system and the world's first insulin pump featuring meal detection technology to regulate insulin levels. Medtronic's products are used worldwide to address more than 70 health problems.

This portfolio has brought the device maker billions of dollars in revenue and profit. But the company's growth may not have reached its maximum. In fact, one particular thing might spur a new wave of growth at Medtronic. The company recently partnered with Nvidia on an artificial intelligence (AI) project -- and it could be a game changer for doctors, patients, and the company. Does this make Medtronic stock a buy? Let's find out.

Medtronic and AI

First, a little background on Medtronic and AI. Medtronic has been exploring and using AI for some time. In fact, its work in the area is already bearing fruit.

For example, it's the only company that has scored U.S. Food and Drug Administration (FDA) clearance for spine surgery predictive models. Last year, the company won regulatory clearance for its UNiD spine analyzer 4.0 platform -- a massive surgical database that powers algorithms to help surgeons better predict eventual spinal alignment. AI allows surgeons to visualize the most likely outcomes for a particular patient, and that helps them better plan their procedures.

AI "is the key to unlocking a new level of personalized medicine in the 21st century," Bob White, executive vice president of Medtronic's medical surgical portfolio, is quoted as saying on the company's website.

The company has even defined a "AI compass," a list of guiding principles for the company to use when applying AI to healthcare. So it's fair to say Medtronic is going all-in on AI.

Let's move on to the latest news. Medtronic is already using its AI tool GI Genius to detect polyps that may lead to colorectal cancer. Now Medtronic is planning to integrate Nvidia Holoscan and Nvidia IGX to further help doctors identify precancerous tissue using "AI-enhanced" diagnostic images.

The partnership also aims to create a broad platform of AI that can progressively improve diagnostics and result in better outcomes. The idea is that third-party developers will be able to create AI tools that may be distributed through GI Genius. A third partner, Cosmo Pharmaceuticals, is running an innovation center website, allowing developers to build and test potential AI software that may one day become part of the GI Genius platform.

This is exciting because Medtronic may benefit from its own technology and that of Nvidia -- and because outside talent may eventually contribute to GI Genius.

"The possibility for GI Genius to host multiple real-time AI applications is a game changer," said Giovanni Di Napoli, president of Medtronic's gastrointestinal business, in a press release.

A growing AI healthcare market

It's also important to keep in mind that the global market for AI in healthcare is forecast to expand at a compound annual growth rate of more than 37% from next year through 2030, according to Grand View Research. Those who establish themselves as leaders have a lot to gain.

Medtronic is among the top five medical device companies worldwide poised to dominate in the AI healthcare world, according to research company GlobalData. Still, competition may be tough. That top five includes other heavyweights, like Johnson & Johnson, which spent almost $15 billion on research and development (R&D) last year.

We don't have full-year results for Medtronic yet, but in the first nine months of the fiscal year, the company spent about $2 billion on R&D. So J&J has the resources to take the lead, but that won't necessarily weigh on Medtronic as more than one player may benefit from an AI revolution.

Earnings and growth

Does this AI deal with Nvidia make Medtronic a buy? The efforts in AI are a big plus, but I wouldn't buy Medtronic for its AI efforts only. I would consider the company's general earnings picture and growth prospects as well.

And in these areas, you'll find more reasons to like Medtronic. The company has increased earnings over time.

MDT Net Income (Annual) Chart

MDT Net Income (Annual) data by YCharts

Today it's streamlining its portfolio by spinning off its patient monitoring and respiratory interventions businesses. It's completed acquisitions that should boost growth -- like that of Affera, which strengthens its cardiac ablation portfolio. And over the past year, Medtronic has won more than 150 product approvals in major geographies. Medtronic also puts a focus on R&D investment, targeting growth at or above revenue growth.

So what do investors have to pay for all of this?

MDT PE Ratio Chart

MDT PE Ratio data by YCharts

Medtronic trades for 29 times trailing-12-month earnings. That's around its lowest levels over the past decade. This looks dirt cheap. That's because Medtronic's focus on AI -- and its new products and efforts right now -- should lead to solid long-term growth. That makes this top healthcare stock a buy today, one that could deliver big over time.