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With a market cap of $202.2 billion, North Chicago, Illinois-based Abbott Laboratories (ABT) is a global healthcare company. It is focused on discovering, developing, and manufacturing a wide range of healthcare products. The company's operations span four key segments: Established Pharmaceuticals; Diagnostics; Nutritional Products; and Medical Devices.
Shares of Abbott Laboratories have underperformed the broader market over the past 52 weeks. ABT stock has risen 24.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 36.1%. In 2024, shares of ABT are up 6.3%, compared to SPX's 26% gain on a YTD basis.
Looking closer, ABT has lagged behind the Health Care Select Sector SPDR Fund's (XLV) 10% returns on a YTD basis. But, the stock has outpaced XLV's 18.8% gain over the past 52 weeks.
Abbott Laboratories stock rose 1.5% on Oct. 16 due to its strong Q3 earnings, where adjusted EPS of $1.21 beat estimates, reflecting a 6.1% increase from last year. Revenue reached $10.6 billion, up 4.9% year-over-year and exceeding the consensus estimate, with the Medical Devices segment leading at 11.7% growth. Key products like FreeStyle Libre and Navitor drove double-digit gains across Diabetes Care, Structural Heart, and Electrophysiology. Management's confidence in performance led to an upward revision of full-year adjusted EPS guidance to $4.64-$4.74 and a projected 9.5%-10% organic sales growth for 2024.
For the current fiscal year, ending in December, analysts expect ABT's EPS to grow 5.2% year-over-year to $4.67. The company's earnings surprise history is promising. It beat or met the consensus estimates in all of the last four quarters.
Among the 24 analysts covering the stock, the consensus rating is a “Strong Buy.” That’s based on 16 “Strong Buy” ratings, two “Moderate Buys,” and six “Holds.”
This configuration is more bullish than three months ago, with 14 “Strong Buy” ratings on the stock.
On Nov. 4, Barclays analyst Matt Miksic raised Abbott's price target to $149 and kept an “Overweight” rating. The firm expects Abbott's necrotizing enterocolitis liability to be $1 billion - $3 billion, with 11% earnings growth from 2024 to 2026, excluding COVID impact.
As of writing, ABT is trading below the mean price target of $132.59. The Street-high price target of $149 implies a modest potential upside of 27.3%.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
