"A favorable ramp in Quattro supply and strong customer support helped ease the Fidelis recall's impact" and suggest "a minimal effect on longer-term market growth," he wrote in a note to investors. Quattro is Medtronic's implantable defibrillator.
Approval of the company's drug-coated stent Endeavor could come earlier than expected and prove to be a key catalyst boosting the company's stock. Also, cost savings and sales from the buyout of Kyphon, completed earlier this month, will help push the stock higher over the next year, he said.
Deutsche Bank-North America analyst Tao Levy reaffirmed a "Buy" rating with a $57 price target, saying the major concerns have been temporarily alleviated.
"The ICD (implantable defibrillator) market impact following the Fidelis lead recall appears to be more manageable than expected and volume loss not as significant," he said in a note to investors.
Though competitor St. Jude Medical is likely still the near-term beneficiary of the Fidelis recall, he said, Medtronic management indicated the market share loss was limited.
Thomas Weisel Partners analyst Robert Faulkner reaffirmed an "Overweight" rating and lowered his price target to $51 from $62. But, he said, implant rates were almost unaffected by the recall and market share could be relatively unaffected if there is continued improvement.
"The main takeaway from the quarter is that the impact of the Fidelis ICD lead recall has been muted relative to expectations," he said.
Meanwhile, Lehman Brothers analyst Bob Hopkins reaffirmed a "Overweight" rating with a $62 price target, and Citi analyst Matthew J. Dodd reaffirmed a "Buy" rating with a $60 price target.