Abbott Laboratories (ABT) AI Stock Analysis

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Abbott Laboratories

(NYSE:ABT)

Rating:80Outperform

Price Target:

$153.00

▲( 14.99% Upside)

Abbott Laboratories receives a solid score due to its strong financial performance and positive earnings call highlights, bolstered by strategic investments and growth in medical devices and nutrition segments. Despite some challenges, such as tariffs and declining diagnostics sales, the company's effective management and strategic initiatives offer a promising outlook. Technical indicators support a positive trend, while valuation remains fair.

Positive Factors

Business Growth

Abbott showcased major advances in its EP business and Volt PFA platform, emphasizing faster-than-expected progress.

Financial Performance

Sales grew an impressive 8.3% organic in a tough macro climate led by 13% organic growth in Medical Devices.

Legal Outcomes

Abbott Laboratories won the first bellwether case, indicating potential strengths in their legal position.

Negative Factors

Legal Challenges

The possibility of different state laws providing an advantage to plaintiffs is considered a wild card, but Abbott is expected to challenge these issues in any trial.

Tariff Impact

Management sized 2025 tariff impact at $300mn to $400mn, resulting in a 3.5% headwind to EPS growth.

Abbott Laboratories (ABT) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$235.23B

Dividend Yield1.69%

Average Volume (3M)7.30M

Price to Earnings (P/E)17.5

Beta (1Y)0.35

Revenue Growth5.00%

EPS Growth139.98%

CountryUS

Employees114,000

SectorHealthcare

Sector Strength44

IndustryMedical - Devices

Share Statistics

EPS (TTM)1.09

Shares Outstanding1,739,836,400

10 Day Avg. Volume6,347,033

30 Day Avg. Volume7,298,359

Financial Highlights & Ratios

PEG Ratio26.69

Price to Book (P/B)2.49

Price to Sales (P/S)0.00

P/FCF Ratio34.82

Enterprise Value/Market Cap1.01

Enterprise Value/Revenue1.43

Enterprise Value/Gross Profit10.08

Enterprise Value/Ebitda5.51

Forecast

1Y Price Target

$144.40

Price Target Upside8.53% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering21

Abbott Laboratories Business Overview & Revenue Model

Company DescriptionAbbott Laboratories, together with its subsidiaries, discovers, develops, manufactures, and sells health care products worldwide. It operates in four segments: Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Medical Devices. The Established Pharmaceutical Products segment provides generic pharmaceuticals for the treatment of pancreatic exocrine insufficiency, irritable bowel syndrome or biliary spasm, intrahepatic cholestasis or depressive symptoms, gynecological disorder, hormone replacement therapy, dyslipidemia, hypertension, hypothyroidism, Ménière's disease and vestibular vertigo, pain, fever, inflammation, and migraine, as well as provides anti-infective clarithromycin, influenza vaccine, and products to regulate physiological rhythm of the colon. The Diagnostic Products segment offers laboratory systems in the areas of immunoassay, clinical chemistry, hematology, and transfusion; molecular diagnostics systems that automate the extraction, purification, and preparation of DNA and RNA from patient samples, as well as detect and measure infectious agents; point of care systems; cartridges for testing blood; rapid diagnostics lateral flow testing products; molecular point-of-care testing for HIV, SARS-CoV-2, influenza A and B, RSV, and strep A; cardiometabolic test systems; drug and alcohol test, and remote patient monitoring and consumer self-test systems; and informatics and automation solutions for use in laboratories. The Nutritional Products segment provides pediatric and adult nutritional products. The Medical Devices segment offers rhythm management, electrophysiology, heart failure, vascular, and structural heart devices for the treatment of cardiovascular diseases; and diabetes care products, as well as neuromodulation devices for the management of chronic pain and movement disorders. Abbott Laboratories was founded in 1888 and is based in North Chicago, Illinois.

How the Company Makes MoneyAbbott Laboratories generates revenue through the sale of its diverse product portfolio across its four main business segments. The Established Pharmaceutical Products segment focuses on branded generic pharmaceuticals, primarily in emerging markets, contributing significantly to the company's revenue. The Diagnostic Products segment offers a range of testing systems and assays, including core laboratory, molecular, and point-of-care testing solutions, generating revenue through both product sales and service contracts. Abbott's Nutritional Products segment includes pediatric and adult nutrition brands like Similac and Ensure, which are distributed globally, providing a steady revenue stream. The Medical Devices segment encompasses a wide array of products for cardiovascular, diabetes care, neuromodulation, and other medical device markets, generating revenue from both the sale of devices and associated consumables. Additionally, strategic partnerships, research and development initiatives, and a focus on innovation help to drive Abbott's growth and profitability in the competitive healthcare industry.

Abbott Laboratories Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Shows how different business units contribute to overall sales, highlighting areas of strength, diversification, and potential growth within the company’s portfolio.

Chart InsightsAbbott Laboratories' Medical Devices segment shows robust growth, driven by diabetes care and structural heart products, aligning with the 12.5% sales increase reported in the earnings call. Meanwhile, the Diagnostics segment faces challenges with declining sales, particularly in China, due to reduced COVID-19 testing and procurement pressures. Nutrition sales are rebounding, supported by strong performance in adult and pediatric nutrition. Despite tariff challenges, Abbott's strategic investments and product launches are poised to sustain growth, with a focus on expanding the US transfusion diagnostic business and introducing over 25 new products in the coming years.

Data provided by:

Main Street Data

Abbott Laboratories Financial Statement Overview

Summary

Abbott Laboratories exhibits strong financial health with consistent profitability, efficient operations, and solid financial management. The company maintains a stable growth trajectory in revenue and cash flow generation, with manageable leverage and effective equity utilization.

Income Statement

Very Positive

Abbott Laboratories shows strong profitability with a consistent gross profit margin and net profit margin. The TTM revenue growth rate is moderate, indicating steady performance. EBIT and EBITDA margins are robust, reflecting efficient operations and cost management.

Balance Sheet

Positive

The balance sheet demonstrates solid equity with a favorable equity ratio. The debt-to-equity ratio indicates manageable leverage, while the return on equity is strong, suggesting effective use of equity financing.

Cash Flow

Very Positive

The cash flow statements show healthy operating cash flow compared to net income, indicating strong cash generation. Free cash flow growth is positive, although not rapidly increasing, it reflects stability in cash management.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
42.34B	41.95B	40.11B	43.65B	43.08B	34.61B
	Gross Profit
23.67B	23.24B	22.13B	24.51B	24.54B	19.61B
	EBIT
7.19B	6.83B	6.48B	8.36B	8.43B	5.36B
	EBITDA
11.20B	10.83B	10.61B	12.38B	12.74B	8.79B
	Net Income Common Stockholders
13.50B	13.40B	5.72B	6.93B	7.07B	4.50B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
6.84B	7.97B	7.28B	10.17B	10.25B	7.15B
	Total Assets
81.45B	81.41B	73.21B	74.44B	75.20B	72.55B
	Total Debt
13.24B	15.02B	15.87B	17.72B	19.01B	19.65B
	Net Debt
6.71B	7.41B	8.98B	7.83B	9.21B	12.81B
	Total Liabilities
32.38B	33.51B	34.39B	37.53B	39.17B	39.55B
	Stockholders Equity
48.81B	47.66B	38.60B	36.69B	35.80B	32.78B
Cash Flow		Free Cash Flow
6.66B	6.35B	5.06B	7.80B	8.65B	5.72B
	Operating Cash Flow
8.95B	8.56B	7.26B	9.58B	10.53B	7.90B
	Investing Cash Flow
-2.38B	-2.34B	-3.13B	-1.74B	-2.01B	-2.21B
	Financing Cash Flow
-6.28B	-5.40B	-7.09B	-7.64B	-5.49B	-2.78B

Abbott Laboratories Technical Analysis

Technical Analysis Sentiment

Positive

Last Price133.05

Price Trends

50DMA

129.52

Positive

100DMA

127.36

Positive

200DMA

120.27

Positive

Market Momentum

MACD

1.20

Negative

RSI

53.85

Neutral

STOCH

83.60

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ABT, the sentiment is Positive. The current price of 133.05 is above the 20-day moving average (MA) of 132.06, above the 50-day MA of 129.52, and above the 200-day MA of 120.27, indicating a bullish trend. The MACD of 1.20 indicates Negative momentum. The RSI at 53.85 is Neutral, neither overbought nor oversold. The STOCH value of 83.60 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ABT.

Abbott Laboratories Risk Analysis

Abbott Laboratories disclosed 20 risk factors in its most recent earnings report. Abbott Laboratories reported the most risks in the “Legal & Regulatory” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Abbott Laboratories Peers Comparison

Overall Rating

UnderperformOutperform

Sector (53)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DXCM	81 Outperform	$34.25B	63.73	23.72%	―	9.11%	-17.87%
ABT	80 Outperform	$235.23B	17.54	30.66%	1.69%	5.00%	139.98%
BSX	78 Outperform	$157.62B	76.67	9.65%	―	19.35%	14.31%
MDT	78 Outperform	$110.77B	26.25	9.49%	3.24%	3.62%	31.18%
SYK	78 Outperform	$148.87B	52.57	14.26%	0.84%	10.76%	-15.22%
EW	71 Outperform	$45.78B	52.00	16.73%	―	-9.84%	-35.77%
Sector *	53 Neutral	$5.24B	3.07	-43.58%	2.80%	16.87%	-0.11%

* Healthcare Sector Average

Performance Comparison

ABT

Abbott Laboratories

133.05

30.87

30.21%

BSX

Boston Scientific

104.64

30.26

40.68%

DXCM

Dexcom

84.89

-40.71

-32.41%

Edwards Lifesciences

76.10

-11.36

-12.99%

MDT

Medtronic

84.41

5.69

7.23%

SYK

Stryker

379.75

52.65

16.10%

Abbott Laboratories Earnings Call Summary

Earnings Call Date:Apr 16, 2025

(Q1-2025)

% Change Since: 5.41%|

Next Earnings Date:Jul 17, 2025

Earnings Call Sentiment Neutral

Abbott Laboratories reported a strong financial performance with significant growth in several segments, including medical devices and nutrition, while facing challenges from tariffs and a decline in diagnostics sales, particularly in China. The company's strategic investments and product innovations provide a solid foundation for future growth, although the impact of tariffs remains a concern.

Q1-2025 Updates

Positive Updates

Strong Overall Financial Performance

Achieved target growth objective with high single-digit sales growth and double-digit earnings per share growth. First quarter sales grew 7% or more than 8% excluding COVID testing sales. Adjusted earnings per share of $1.09 grew 11% versus the prior year.

Nutrition Segment Growth

Sales increased 7% in the quarter, driven by high single-digit growth in adult nutrition and double-digit growth in US pediatric nutrition.

Medical Devices Surge

Sales grew 12.5%, with strong performance in diabetes care, structural heart, and electrophysiology segments. Continuous glucose monitors grew more than 20%, including 30% growth in the US.

Strategic Manufacturing and R&D Investments

On track to go live with two new manufacturing and R&D investments in Illinois and Texas by the end of the year, totaling half a billion dollars, to expand US transfusion diagnostic business.

Positive Developments in Electrophysiology and Structural Heart

Electrophysiology sales grew 10% with early Volt PFA system launch in Europe. Structural heart segment grew 15% with strong performance in surgical valves and transcatheter repair products.

Negative Updates

Impact of Tariffs

Tariffs estimated to impact 2025 by a few hundred million dollars, primarily affecting the US and China, with potential long-term implications.

Diagnostics Sales Decline

Sales declined 5% in the quarter due to a year-over-year decline in COVID-19 testing sales and the impact of volume-based procurement programs in China.

Challenges in China Diagnostics Market

Core laboratory diagnostics affected by volume-based procurement programs in China, leading to lower sales growth without volume offset.

Company Guidance

During Abbott Laboratories' First Quarter 2025 Earnings Conference Call, the company provided guidance that emphasized its resilient performance and strategic initiatives amid a dynamic economic environment. Abbott Laboratories reported a 7% increase in first-quarter sales, or more than 8% excluding COVID testing sales, and an 11% rise in adjusted earnings per share to $1.09, which was at the high end of their guidance range. The company achieved high single-digit sales growth and double-digit EPS growth, with gross margin expanding by 140 basis points and operating margin by 130 basis points compared to the prior year. Despite challenges such as new tariffs, Abbott Laboratories reaffirmed its full-year guidance, projecting adjusted earnings per share for the second quarter to be in the range of $1.23 to $1.27. The company highlighted its diverse business model's strength, with significant growth in medical devices (12.5%), diabetes care sales ($1.7 billion), and structural heart (15%). Abbott Laboratories is also making strategic investments, including half a billion dollars to expand its US transfusion diagnostic business, and is on track to launch more than 25 key new products over the next three years.

Abbott Laboratories Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

Abbott Laboratories Announces Executive Vice President’s Retirement

Neutral

May 1, 2025

On April 25, 2025, Abbott Laboratories announced that Hubert L. Allen, the Executive Vice President, General Counsel, and Secretary, plans to retire after a transition period. This leadership change could impact the company’s operations and strategic direction, potentially influencing its market positioning and stakeholder relationships.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.