Citi Discusses Covidien's Earnings (COV)

Citi Investment Research has a Buy rating and a $64 price target on shares of Covidien Ltd COV following the company's earnings report. In a note to investors, Citi writes, "Management is raising F2011 guidance with sales now expected to increase +8-11%, up 200bps vs. prior range, which largely addresses the improved FX benefit of the weaker US dollar. Medical Devices (+13-16%) accounts for the majority of the increase with Pharma (-3%-flat) adding less and Medical Supplies unchanged from prior (0-3%) guidance. The mid point of the revised 18.5-19.5% tax range is +60bps up from 18.4% guidance, but street EPS views should still move about $0.10 higher." Shares of COV are trading at $54.90, up $1.03, a gain of 1.9% this morning.