Covidien Ltd. (NYSE:COV)
The Company is in the business of developing, manufacturing and distributing medical devices and supplies, diagnostic imaging agents, pharmaceuticals and other healthcare products for use in clinical and home settings.
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Picked on the recommendation of TMFdeej
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Covidien is a company that I've had my eye on for a while, ever since it was spun off from Tyco. It hasn't done much but bounce around since then. It just announced that it plans to split its medical device and pharma businesses. I like the move.
Deej
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Covidien is currently undervalued by about 12%, just based on estimates of 4.30 eps and current P/E of 11.6. But with strong growth projected for 2012, it probably deserves a higher P/E. Add the great dividend and good pipeline, it's a combination growth/value play.
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Baby Boomers.
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Mechanical formula YLDEARNYEAR2
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key03, 1.4% annual dividend
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s&P 5 star. 1.4 div
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50 crossing 200 strong fundamentals
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Raymond James Picks 2011
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Growth in 5 to 10 years. Probably longer. Medical devices medical devices medical devices... we'll all be needing them and they're leading the niche markets, sopping up whatever they can that looks valuable.
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Stock Picker - 5 Star, Pays Dividend, Down at Least 20% over last 12 months
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Has the look of value
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This is a very strong company with very little debt. They are also leaders in the areas they serve.
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Undervalued, good financials.
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Aging boomers, M* says so, good trend
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Tyco who? Since the spin off, in the the last 3 years these guys have made acquisition after acquisition. This includes the 2+ billion for Ev3 June 9th, and oh yeah, the 250+ Million for Somanetics a few days ago...June 16th. The commitment to grow, and willingness to do that through acqusitions (and organically when possible), and then actually go out and make some fairly smart purchases (reasonably priced though... not home runs by any stretch) means profits for the company. Profits for the company, means profits for the investors. They seem to be a market-leader in almost all of their divisions, and if they aren't, they certainly aren't bashful in selling them off for hundreds of millions using that money to gobble up smaller niche leaders and plug gaps in the portfolio.
How about the innovator of the year award in 2009? That's probably a pretty good sign of what direction these guys intend to head. The commitment to innvovate, grow, shed losing brands/divisions, and push it's titantic-sized employee force means that the leaders at the top have their eyes on target, and that target keeps moving forward. I'm all for a company that has a ton of net cash coming in, and wants to put it use instead of just watching the bank account grow. Especially if they do it wisely, which COV appears to be doing.
The whole sector has taken a punch in the gut lately. COV isn't the best deal out there value-wise right now (BDX, BCR, and a few other look more attractive). But actions sometime speak louder than anything else, and i certainly like what i see for a long-term investment.
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good company in healthcare sector
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Covidian will underperform the S&P for the next year.
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Without much debt to equity, Covidien is among the leaders in a sector that will likely outperform for the short to mid-term. The stock is a buck or two above the 50 day moving average here, but insiders were picking it up at $50+ in mid 08. Year over year revenue increased by 12%, and it's trading at a modest 12.75 forward p/e.
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