Investors looking to play the medical device trade, and find a solid dividend, should consider putting their money in Medtronic, said Shannon Saccocia, chief investment officer at SVB Private. “This valuation is undemanding and looks quite attractive at this point along with the dividend yield,” she told CNBC’s ” Halftime Report ” on Monday. So far this year, Medtronic shares have gained 6.4% after tumbling about 25% in 2022. Shares also offer a dividend yield of roughly 3.3%, according to FactSet. Saccocia sold the stock last year as the company grappled with execution issues, but a new management team that’s able to execute should help temper some of last year’s problems and improve the company’s product pipeline, she said. Her firm has recently added Medtronic back to its holdings, specifically in its dividend portfolio. Within the medical devices space, Saccocia also owns Stryker , up more than 2% this year after it dipped about 8.6% in 2022. “Medical equipment, we believe that the big risks here is that we don’t see the continued growth in procedure volume coming out of the pandemic, but we’re willing to take that chance given the valuation on the stock,” she said. As Saccocia bought Medtronic, she sold shares of Merck , citing concerns about the pipeline for the company’s cancer drug Keytruda. “There could still be continued earnings improvement and earnings growth in the stock,” she said. “But we would like to see them growing that pipeline and we think that that might become a little bit pricey as they’re looking for M & A acquisitions in order to do that.” Merck shares are down more than 4% this year after a nearly 45% rally last year.
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