Oppenheimer's 5 Highlights From Medtronic's Analyst Day

In a report published Friday, Oppenheimer analyst Steven Lichtman summarized highlights from Medtronic's MDT Analyst Day.

Following Medtronic's investor meeting, Lichtman emphasized the company's focus on using the changing healthcare landscape to its advantage. The analyst came away with five key points, with attention on key product drivers.

1. Partnerships and Solutions

A top theme, Oppenheimer remarked on the company's plans to “play a broader role in care delivery with partnerships with physicians, hospitals, payers, and governments. CardioCom/cath lab management are two key platforms in which MDT can differentiate by bringing economic/outcomes value.”

The analyst added that management reported new partnerships with Aetna.

2. CRM End-Markets

Medtronic's management isn't forecasting “meaningful recovery” in CRM end-markets. For above-market growth, Lichtman noted the Micra leadless pacemaker, Reveal LINQ and Patch as key drivers. The company “believes its design can avoid the perforations STJ reported with its Nanostim device.”

3. Neurosurgery Call Point for Spine

In the meeting, the company is optimistic on Spine improving over the next few years. Oppenheimer assumes Medtronic's confidence is based off of market growth and stabilization in BKP/BMP declines. Lichtman added that neurosurgery callpoint is a “key lever ahead.”

4. Medtronic's Plan on Diabetes

The analyst wrote, “A disposable patch pump is no longer in MDT's strategic plan; this is a nice positive for PODD. MDT will continue to enhance Enlite (CGM sensor); visibility is low on what the improvements entail. No update on 640G US timing. We expect to hear more at ADA on MDT's growing focus in Type-2 diabetes.”

5. IRS Litigation Possibilities

With the IRS litigation trial scheduled for February 2015, Lichtman forecasts that the company could have a $4.5 billion OUS cash and retroactive tax hit, or $2.5 billion OUS cash without the tax hit. The analyst sees a settlement between these two possibilities.

Shares of Medtronic closed at $62.04 on Thursday and are currently up 0.84 percent.