Medtronic Shares Selling Off Despite Inline Q3 Results, Narrowed FY Outlook

Medtronic, MDT announced its third quarter of fiscal year 2014 earnings on Tuesday morning. Shares are down more than 2 percent to around $55.55 at last check. Revenue grew 4 percent on constant currency basis to $4.2 billion, slightly higher than the $4.15 billion analyst estimates. GAAP diluted EPS came in at $0.75, while non-GAAP diluted EPS of $0.91 was in line with analyst estimate. The most significant third quarter GAAP to non-GAAP adjustment was a charge primarily related to the impairment of the company's renal denervation in-process research and development and related long-lived assets following the announcement that the HTN-3 trial did not meet its primary efficacy endpoint. "The U.S. approvals of CoreValve and the MiniMed 530G System marked important milestones and are part of an ongoing product launch cadence of innovative therapies," said Omar Ishrak, Medtronic CEO. Emerging market revenues increased 12 percent to $521 million, representing 13 percent of the companies revenue. Medtronic reiterated its revenue outlook and tightened its diluted earnings per share guidance for fiscal year 2014. The company expects fiscal year 2014 diluted EPS in the range of $3.81 to $3.83, in line with analyst estimates at 3.82, which implies annual diluted non-GAAP earnings per share growth of approximately 6 percent. Medtronic had previously been expecting FY14 EPS in the range of $3.80-3.85.