UPDATE: JP Morgan Upgrades Medtronic to Overweight

In a report released Monday, J.P. Morgan analyst Michael Weinstein upgrades Medtronic MDT from Neutral to Overweight. The firm's Michael Weinstein boosted his price target on Medtronic shares from $64 to $78. Medtronic is currently in the process of acquiring Covidien COV for cash and stock. Weinstein highlighted three reasons why the acquisition creates shareholder value:

• Medtronic acquires access to Covidien's cash;
• tax rate lowered; and,
• current capital allocation sustained.

Medtronic shares have declined slightly Monday, trading around $60.30, while shares of Covidien have surged nearly 20 percent to around $86.30.