Stock Analysis on Net
Stock Analysis on Net

Medtronic PLC (NYSE:MDT)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Medtronic PLC, balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Apr 26, 2024 Apr 28, 2023 Apr 29, 2022 Apr 30, 2021 Apr 24, 2020 Apr 26, 2019
Goodwill 40,986 41,425 40,502 41,961 39,841 39,959
Customer-related 16,518 16,956 16,953 17,036 16,963 16,944
Purchased technology and patents 11,557 11,659 10,802 11,286 10,742 11,405
Trademarks and tradenames 424 486 473 475 464 570
Other 256 116 80 82 75 85
Definite-lived intangible assets, gross carrying amount 28,755 29,217 28,308 28,879 28,244 29,004
Accumulated amortization (15,915) (14,605) (13,006) (11,533) (9,704) (9,048)
Definite-lived intangible assets, net 12,840 14,612 15,302 17,346 18,540 19,956
IPR&D 385 232 293 394 523 604
Indefinite-lived intangible assets 385 232 293 394 523 604
Intangible assets, net 13,225 14,844 15,595 17,740 19,063 20,560
Goodwill and other intangible assets, net 54,211 56,269 56,097 59,701 58,904 60,519

Based on: 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24), 10-K (reporting date: 2019-04-26).

Item Description The company
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Medtronic PLC goodwill increased from 2022 to 2023 but then slightly decreased from 2023 to 2024.
Intangible assets, net Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Medtronic PLC intangible assets, net decreased from 2022 to 2023 and from 2023 to 2024.
Goodwill and other intangible assets, net Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Medtronic PLC goodwill and other intangible assets, net increased from 2022 to 2023 but then decreased significantly from 2023 to 2024.

Adjustments to Financial Statements: Removal of Goodwill

Medtronic PLC, adjustments to financial statements

US$ in millions

Microsoft Excel
Apr 26, 2024 Apr 28, 2023 Apr 29, 2022 Apr 30, 2021 Apr 24, 2020 Apr 26, 2019
Adjustment to Total Assets
Total assets (as reported) 89,981 90,948 90,981 93,083 90,689 89,694
Less: Goodwill 40,986 41,425 40,502 41,961 39,841 39,959
Total assets (adjusted) 48,995 49,523 50,479 51,122 50,848 49,735
Adjustment to Shareholders’ Equity
Shareholders’ equity (as reported) 50,214 51,483 52,551 51,428 50,737 50,091
Less: Goodwill 40,986 41,425 40,502 41,961 39,841 39,959
Shareholders’ equity (adjusted) 9,228 10,058 12,049 9,467 10,896 10,132

Based on: 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24), 10-K (reporting date: 2019-04-26).

Medtronic PLC, Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Medtronic PLC, adjusted financial ratios

Microsoft Excel
Apr 26, 2024 Apr 28, 2023 Apr 29, 2022 Apr 30, 2021 Apr 24, 2020 Apr 26, 2019
Total Asset Turnover
Reported total asset turnover 0.36 0.34 0.35 0.32 0.32 0.34
Adjusted total asset turnover 0.66 0.63 0.63 0.59 0.57 0.61
Financial Leverage
Reported financial leverage 1.79 1.77 1.73 1.81 1.79 1.79
Adjusted financial leverage 5.31 4.92 4.19 5.40 4.67 4.91
Return on Equity (ROE)
Reported ROE 7.32% 7.30% 9.59% 7.01% 9.44% 9.25%
Adjusted ROE 39.84% 37.36% 41.82% 38.09% 43.95% 45.71%
Return on Assets (ROA)
Reported ROA 4.09% 4.13% 5.54% 3.87% 5.28% 5.16%
Adjusted ROA 7.50% 7.59% 9.98% 7.05% 9.42% 9.31%

Based on: 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24), 10-K (reporting date: 2019-04-26).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Medtronic PLC adjusted total asset turnover ratio improved from 2022 to 2023 and from 2023 to 2024.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Medtronic PLC adjusted financial leverage ratio increased from 2022 to 2023 and from 2023 to 2024.
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Medtronic PLC adjusted ROE deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Medtronic PLC adjusted ROA deteriorated from 2022 to 2023 and from 2023 to 2024.

Medtronic PLC, Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Microsoft Excel
Apr 26, 2024 Apr 28, 2023 Apr 29, 2022 Apr 30, 2021 Apr 24, 2020 Apr 26, 2019
As Reported
Selected Financial Data (US$ in millions)
Net sales 32,364 31,227 31,686 30,117 28,913 30,557
Total assets 89,981 90,948 90,981 93,083 90,689 89,694
Activity Ratio
Total asset turnover1 0.36 0.34 0.35 0.32 0.32 0.34
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net sales 32,364 31,227 31,686 30,117 28,913 30,557
Adjusted total assets 48,995 49,523 50,479 51,122 50,848 49,735
Activity Ratio
Adjusted total asset turnover2 0.66 0.63 0.63 0.59 0.57 0.61

Based on: 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24), 10-K (reporting date: 2019-04-26).

2024 Calculations

1 Total asset turnover = Net sales ÷ Total assets
= 32,364 ÷ 89,981 = 0.36

2 Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 32,364 ÷ 48,995 = 0.66

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Medtronic PLC adjusted total asset turnover ratio improved from 2022 to 2023 and from 2023 to 2024.

Adjusted Financial Leverage

Microsoft Excel
Apr 26, 2024 Apr 28, 2023 Apr 29, 2022 Apr 30, 2021 Apr 24, 2020 Apr 26, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets 89,981 90,948 90,981 93,083 90,689 89,694
Shareholders’ equity 50,214 51,483 52,551 51,428 50,737 50,091
Solvency Ratio
Financial leverage1 1.79 1.77 1.73 1.81 1.79 1.79
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 48,995 49,523 50,479 51,122 50,848 49,735
Adjusted shareholders’ equity 9,228 10,058 12,049 9,467 10,896 10,132
Solvency Ratio
Adjusted financial leverage2 5.31 4.92 4.19 5.40 4.67 4.91

Based on: 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24), 10-K (reporting date: 2019-04-26).

2024 Calculations

1 Financial leverage = Total assets ÷ Shareholders’ equity
= 89,981 ÷ 50,214 = 1.79

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted shareholders’ equity
= 48,995 ÷ 9,228 = 5.31

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Medtronic PLC adjusted financial leverage ratio increased from 2022 to 2023 and from 2023 to 2024.

Adjusted Return on Equity (ROE)

Microsoft Excel
Apr 26, 2024 Apr 28, 2023 Apr 29, 2022 Apr 30, 2021 Apr 24, 2020 Apr 26, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Medtronic 3,676 3,758 5,039 3,606 4,789 4,631
Shareholders’ equity 50,214 51,483 52,551 51,428 50,737 50,091
Profitability Ratio
ROE1 7.32% 7.30% 9.59% 7.01% 9.44% 9.25%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Medtronic 3,676 3,758 5,039 3,606 4,789 4,631
Adjusted shareholders’ equity 9,228 10,058 12,049 9,467 10,896 10,132
Profitability Ratio
Adjusted ROE2 39.84% 37.36% 41.82% 38.09% 43.95% 45.71%

Based on: 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24), 10-K (reporting date: 2019-04-26).

2024 Calculations

1 ROE = 100 × Net income attributable to Medtronic ÷ Shareholders’ equity
= 100 × 3,676 ÷ 50,214 = 7.32%

2 Adjusted ROE = 100 × Net income attributable to Medtronic ÷ Adjusted shareholders’ equity
= 100 × 3,676 ÷ 9,228 = 39.84%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Medtronic PLC adjusted ROE deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level.

Adjusted Return on Assets (ROA)

Microsoft Excel
Apr 26, 2024 Apr 28, 2023 Apr 29, 2022 Apr 30, 2021 Apr 24, 2020 Apr 26, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Medtronic 3,676 3,758 5,039 3,606 4,789 4,631
Total assets 89,981 90,948 90,981 93,083 90,689 89,694
Profitability Ratio
ROA1 4.09% 4.13% 5.54% 3.87% 5.28% 5.16%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Medtronic 3,676 3,758 5,039 3,606 4,789 4,631
Adjusted total assets 48,995 49,523 50,479 51,122 50,848 49,735
Profitability Ratio
Adjusted ROA2 7.50% 7.59% 9.98% 7.05% 9.42% 9.31%

Based on: 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24), 10-K (reporting date: 2019-04-26).

2024 Calculations

1 ROA = 100 × Net income attributable to Medtronic ÷ Total assets
= 100 × 3,676 ÷ 89,981 = 4.09%

2 Adjusted ROA = 100 × Net income attributable to Medtronic ÷ Adjusted total assets
= 100 × 3,676 ÷ 48,995 = 7.50%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Medtronic PLC adjusted ROA deteriorated from 2022 to 2023 and from 2023 to 2024.