There are no safe havens in the stock market. Every stock carries risk. But some less than others. This column features stocks that have shown one or more of the following characteristics: less volatility, better earnings, larger market caps, safe and increasing dividends. In these times of turmoil, our goal is to show readers better opportunities for investing with fewer risks.

September 15, 2008 - Medtronic, Inc. (MDT-NYSE) develops, manufactures, and markets medical devices worldwide. The company's Cardiac Rhythm Disease Management segment primarily offers pacemakers, implantable defibrillators, leads, ablation products, electrophysiology catheters, insertable cardiac monitors, and information systems for cardiac rhythm disease management.

The Neuromodulation segment provides therapeutic and diagnostic devices, including implantable neurostimulation systems, implantable drug delivery devices, and urology and gastroenterology products. The Diabetes segment offers external insulin pumps and related consumables, continuous glucose monitoring systems, and subcutaneous glucose sensors.

The Surgical Technologies segment provides products to treat conditions of the ear, nose, and throat, as well as certain neurological disorders. It offers powered tissue-removal systems and other microendoscopy instruments, implantable devices, nerve monitoring systems, disposable fluid-control products, hydrocephalus shunt devices, external drainage systems, cranial fixation devices, neuroendoscopes, dura repair products, and image-guided surgery systems. The Physio-Control segment offers external defibrillators, including manual defibrillator/monitors used by hospitals and emergency response personnel, and automated external defibrillators used in commercial and public settings; and related data management solutions and support services. The company was founded in 1949 and is headquartered in Minneapolis, Minnesota.

For the last 5 years, the company has delivered annual earnings growth, on average of 13.2% while revenues increased, on average, 15% a year. For the next 5 years, analysts see earnings improvement of 13.2% a year, on average with sales moving up by 12% a year, on average. That's good solid growth, in the past and for the future.

Earnings were $2.60 last year, up from $2.41 in 2006. This year, analysts see $3.00 and next year $3.36. In the first quarter of the fiscal year (ends July 31), earnings were 72 cents a share, up from 62 cents in the same quarter last year. This quarter (reports in November) analysts look for 71 cents a share, an improvement over 58 cents last year.

Backing up the earnings is a solid balance sheet. Value Line gives the company an A++ financial strength rating. In the most recent quarter, there was $1.75 billion in cash in the bank. Total debt to equity was .58. The current ratio (current assets divided by current liabilities) was 1.98 or almost twice as much liquidity as short term debt.

Revenues in the first quarter of the year jumped by 18.5% compared to the same quarter last year. The purchase of Kyphon late last year helped top line growth. The weak dollar boosted international sales and improved revenues by $157 million in exchange rates gain for the first three months. Six of the company's seven businesses had double digit, year over year, improvement. Cardiovascular sales bumped up 30% to $631 million.

Profits have continued upward thanks to better efficiencies, sales mix, and the favorable exchange rates. The earnings per share have been enhanced by the company's continued stock buyback program.

More numbers: For the last 6 years, the stock has been range bound, moving between $42 and $59.90 a share. There is an annual dividend of $.75, giving a yield of 1.4%. Trailing P/E (price to earnings) ratio is 26.5, but the forward p/e is 16. Price to Sales ratio is 4.32. Price to Book is 4.97. Profit margin was 16.34% for the trailing twelve months with an Operation margin of 31.18%. Return on Equity was 19.7%. Total debt is $7.13 billion. There are 1.13 billion shares outstanding.

Conservative investors should find this stock of interest. While it's been holding in a relatively narrow range for several years, with the solid growth projected, it may be about to breakthrough the upper end and move ahead. Certainly earnings growth will look good compared to many other companies, especially ones with only a U.S. base. While not completely recession proof, there's no question people who need to replace certain parts of their bodies won't hesitate to do so. With more people living longer, worldwide, the demand for MDT's products should only keep growing.

- Company Web site: www.medtronic.com

- Ted Allrich