Elliott Partner Marc Steinberg stated that the decision to become one of the largest investors in Medtronic was driven by the conviction that the company is entering a new chapter of value creation.
Med-tech company Medtronic (MDT) announced on Tuesday that its board of directors has appointed industry veterans John Groetelaars and Bill Jellison as independent directors, effective immediately, after Elliott Investment Management added a substantial stake in the firm.
The company also announced the formation of two special committees. Of this, one will be responsible for guiding the evaluation and execution of growth-accretive tuck-in mergers and acquisitions, organic research and development investments, and potential divestitures.
The other committee will align governance with the company’s initiatives to optimize operational performance, deliver margin expansion, and drive sustained earnings acceleration, the company said.
CEO Geoff Martha will serve as Chair of both of the newly formed committees, and both the newly appointed directors will serve on one or both of the committees. Groetelaars and Jellison will further be nominated to stand for election to the board at Medtronic’s 2025 annual general meeting of shareholders, it said.
The company said that the move followed dialogue with Elliott Investment Management L.P., which is now one of the largest investors in the company. Elliott Partner Marc Steinberg stated that the decision to become one of the largest investors in Medtronic was driven by the conviction that the company is entering a new chapter of value creation.
“We believe Medtronic’s recent innovations in some of the medical technology sector’s most attractive markets have positioned the company for an inflection in organic growth… Today’s announcements – including the addition of new directors with deep medical technology experience and the formation of two focused Board committees – are the right steps towards realizing Medtronic’s potential,” Steinberg said.
The Wall Street Journal reported the board appointments earlier today. On Stocktwits, retail sentiment around MDT jumped from ‘bullish’ to ‘extremely bullish’ territory over the past 24 hours, while message volume rose from ‘normal’ to ‘extremely high’ levels.
A Stocktwits user believes the company’s long-term value looks solid, if it can maintain steady revenue growth and keep innovating in key product lines.
On Tuesday, the company reported earnings for the first quarter of fiscal year 2026 (FY26), which ended July 25, and raised its FY26 earnings guidance. For FY26, the company continues to expect organic revenue growth of approximately 5%. It also raised its FY26 diluted and adjusted earnings per share guidance to the new range of $5.60 to $5.66 versus the prior range of $5.50 to $5.60.
For the first quarter, the firm reported revenue of $8.578 billion, exceeding a Wall Street estimate of $8.371 billion. The growth was spurred by growth across the company’s cardiovascular, neuroscience, medical surgical, and diabetes business portfolios.
Adjusted and diluted earnings per share in the quarter came in at $1.26, above an estimated $1.23.
MDT stock is up by 16% this year and by about 9% over the past 12 months.
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