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Super-Wide Moat in the Making at Medtronic

The device maker's planned acquisition of Covidien will make it a force to be reckoned with.

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Debbie Wang: Medtronic (MDT) is one of our favorite wide-moat firms in the medical-technology arena. It's the largest pure-play business in medical devices. So, it has a leadership position in key therapeutic areas like cardiac-rhythm management and spine and structural heart.

This company also creates a lot of cash flow, and so what it likes to do is invest that into emerging technologies, which sets up this company for a lot of potential in the future. The biggest news recently for Medtronic is that it is going to be buying Covidien (COV), which is also a wide-moat company. You put the two wide moats together, and you end up with a super-wide-moat company.

Debbie Wang does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.