12:26 PM EDT, 10/10/2024 (MT Newswires) -- Medtronic ( MDT ) is set for growth, fueled by improving business fundamentals and enhanced management execution, RBC Capital Markets said in a Thursday note.

Following a recent meeting with Medtronic ( MDT ) Chief Executive Geoff Martha and thorough due diligence, RBC said it has a "renewed" confidence in the company's core business, including cardiac rhythm management, surgery, and spine, to "comfortably deliver [mid-single-digit] sales growth against a backdrop of positive healthcare utilization."

RBC said that Medtronic ( MDT ) is "trading at the deepest discount to the S&P 500 at 6x versus 10-year historic average of 1x. We believe this is no longer justified and expect a re-rating in the stock as catalysts take hold."

The firm further noted that Medtronic ( MDT ) has an "attractive" free cash flow profile with an expected conversion rate exceeding 80%.

RBC upgraded Medtronic ( MDT ) to outperform from sector perform and raised the price target to $105 from $98.

Price: 89.02, Change: +0.67, Percent Change: +0.76