This Undervalued Dividend Aristocrat Just Raised its Dividend

On May 21, Medtronic plc (NYSE:MDT) declared a 1.4% hike in its dividend, which took its quarterly dividend to $0.71 per share.

Medtronic plc (NYSE:MDT) is a leading medical device maker with operations spanning medical-surgical, neuroscience, cardiovascular, and diabetes segments. It recently announced its quarterly dividend alongside its financial results for fiscal Q4 and FY25.

The company’s solid cash performance in FY25 likely supported the dividend increase. Medtronic plc (NYSE:MDT) reported $7 billion in operating cash flow and $5.2 billion in free cash flow for the year. It also returned $6.3 billion to shareholders through dividends and share buybacks.

The dividend boost was widely expected, as Medtronic plc (NYSE:MDT) holds the status of a Dividend King, having raised its payout for 48 consecutive years. The stock supports a solid dividend yield of 3.3%, as of May 21. MDT will trade ex-dividend on June 27.

With a forward P/E ratio of 14.77, MDT appears undervalued compared to many of its industry peers, suggesting the stock may offer an attractive entry point for long-term investors. The stock is up by over 5% in 2025 so far.

While we acknowledge the potential of MDT as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than MDT but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the dirt cheap dividend stock.

READ MORE: 10 Unstoppable Dividend Stocks to Buy Now and 25 High Dividend Stocks Being Targeted By Short Sellers

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