Since combining with Covidien, the new Medtronic Plc is undervalued, according to a Seeking Alpha report.
Here are seven things to know:
1. The combined cash flow and growth opportunities show a suggested valuation of more than $100 per share. The company is currently trading at $77 per share.
2. There is an $850 million in pre-tax synergies that is expected to further increase the company's valuation.
3. The management's goal is to return 50 percent of free cash flow to shareholders.
4. The current Intrinsic Market Value of $149 billion with 1.436 billion shares outstanding.
5. The "old" Medtronic's revenues are expected to grow 6+ percent and Covidien is expected to grow revenues at 5+ percent through 2019.
6. There are some potential risks for the company, including the failure to integrate the two businesses and industry consolidation among competitors that could increase competition.
7. Healthcare policy and regulatory changes could have an impact on Medtronic's future growth; the tax law changes for multinational corporations are another factor to consider as well as product liability claims.