Under the new plan, the U.S. Treasury Department and the IRS will make it difficult for companies to make inversion deals, reducing the benefit of moving their headquarters outside of the U.S. for lower taxes. The medical appliances and equipment maker recently announced plans to move its headquarters to Ireland for its lower tax rate through its acquisition of Covidien (COV) .
Part of the new rules require inverted companies to pay U.S. taxes when taking loans from foreign subsidiaries, according to Bloomberg.
"These first, targeted steps make substantial progress in constraining the creative techniques used to avoid U.S. taxes, both in terms of meaningfully reducing the economic benefits of inversions after the fact, and when possible, stopping them altogether," Treasury Secretary Jacob J. Lew said in a statement. Lew added that "for some companies considering deals, today's action will mean that inversions will no longer make economic sense."
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, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."