The General Administration of Customs, China has asked consumers not to buy or consume a few baby products manufactured by American pharmaceutical company Abbott Laboratories (ABT), which were included in a voluntary recall, according to Reuters.
Shares of Abbott fell 3.1%, closing at $116.79 on February 18, after the company recalled powder formulas manufactured in its Michigan Unit.
China Warns Consumers
On Thursday, February 17, Abbott recalled some of its baby food formulas including Similac, Alimentum, and EleCare, which were produced at Abbott Nutrition’s Sturgis facility in Michigan. The said products affected children with bacterial infections, namely Cronobacter sakazakii and Salmonella Newport infections.
Following the recall, China Customs has asked customers to refrain from buying the products. While the products were not directly sold in China, authorities warned customers who may have bought them in cross-border e-commerce transactions.
Meanwhile, one product, Similac human milk fortifier, was sold in China and was included in the recall.
Following China Custom’s warning, other countries too, issued statements to consumers to stop using Abbott’s products. The Omani Ministry of Health warned consumers against using two baby milk powder formulas on Monday. Similarly, the Saudi Food and Drug Authority also issued a warning for three baby milk powders made by Abbott.
The Wall Street community has awarded Abbott a Strong Buy consensus rating with 7 Buys and 1 Hold. The average Abbott price target of $145.13 implies 24.3% upside potential to current levels. However, ABT has lost 15.7% year-to-date against registering a gain of 3.3% over the past year.
According to TipRanks data, the News Score for Abbott is currently Positive based on 30 articles over the past seven days. 75% of the articles have a Bullish Sentiment compared to a sector average of 60% while 25% of the articles have a Bearish Sentiment compared to a sector average of 40%.
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