Medtronic (MDT -0.14%), a beast of a medical-device company, has caught the eye of more than a few income investors. It has enacted dividend raises at least once annually for a hard-to-beat 47 years straight and approaches high-yield dividend territory with a payout hovering just below 4%.
As that distribution is a major part of the stock's popularity, it's worth looking at a key number behind it -- quite simply, how much will it amount to across 2024?
An incremental raiser
Medtronic recently declared a dividend raise. Concurrent with the release of its latest financials in May, the medical-device king added $0.01 per share to its quarterly payout for a new level of $0.70. This will be paid each quarter in this new fiscal year.
The final $0.69 per-share distribution was handed out in April, so that plus the three $0.70 payouts equals $2.79 per share. That's nice and chunky for yield seekers. When mashed against the less than $78 per-share stock price, Medtronic's calendar 2024 distributions will pay out at a 3.6% rate. That's better than many blue chip stocks, to say nothing of the generally dividend-averse healthcare sector.
We should always be a bit wary of modest dividend raises such as this one. Medtronic is a sprawling and powerful company, but it's also fairly mature. While it managed to lift its fiscal 2024 revenue by 3.6% year over year (to $32.4 billion), this followed a 2023 that saw a slight (1%) decline. As for profitability, 2024's headline net income was 2% down from the previous year at almost $3.7 billion.
Slow growth ahead?
Medtronic is projecting top-line growth of 4% to 5% for fiscal 2025, but some analysts would beg to differ. On average, they're projecting a rise of barely over 3%.
This stock is a slow-moving incumbent that's best suited for yield seekers. I don't anticipate great movement on its fundamentals and, consequently, stock price, but I think those dividend raises will continue... as modest as they've been lately.
