Will Medtronic (MDT) Stock Rebound After Covidien (COV) Deal?

NEW YORK (TheStreet) -- Shares of Medtronic Inc. (MDT) are down -2.62 to $59.11 in very heavy trading volume after agreeing to buy Covidien Plc (COV) for $42.9 billion in cash and stock.

The company today said it will remain in the market for promising new technologies even as it absorbs the Dublin-based medical device maker, Reuters reports.

Medtronic executives told analysts on a conference call that the additional cash flow generated by combining the two companies would expand the budget for acquisitions and minority investments, as well as internal R&D, Reuters noted.

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TheStreet Ratings team rates MEDTRONIC INC as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

"We rate MEDTRONIC INC (MDT) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

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