Abbott Labs (ABT) Earnings up Y/Y, Stent Sales Decline - Tale of the Tape
Abbott Laboratories (ABT), discovers, develops, manufactures and sells a diversified line of healthcare products. On Jan 1, 2013, Abbott Labs separated its pharmaceutical business into a new company called AbbVie.
Abbott Labs reports its diversified business in four segments – namely Established Pharmaceuticals Division (EPD), Medical Devices, Diagnostics and Nutritionals.
We note that Abbott Labs agreed to sell its developed markets generics pharmaceutical business to Mylan, Inc. in Jul 2014. Hence, investors will mainly focus on Abbott Labs’ business strategy going forward given the impending divestiture. The sale of branded generics business is expected to positively impact the top line and bottom line as Abbott Labs will now focus primarily on the branded generics pharmaceuticals business in emerging markets. However, vascular business continues to be weak.
Abbott Labs has a pretty good earnings track record with the company delivering positive earnings surprises in each of the last four quarters with an average surprise of 6.59%. However, estimate revisions have gone down for 2015.
Currently, Abbott Labs has a Zacks Rank #4 (Sell). We have highlighted some of the key stats from this just-revealed announcement below:
Earnings: Abbott Labs reported earnings from continued operations of $0.62, up 29.2% y/y. Including results of discontinued operations, total earnings were $0.71. Our consensus called for EPS of $0.68.
Revenue: Revenues missed expectations. Abbott Labs posted revenues of $5.4 billion, compared to our consensus estimate of $5.6 billion but were up on y/y basis.
Key Stats: Currency headwinds continue to adversely impact sales. The vascular business is particularly dismal in the U.S. as a competitive environment in the drug-eluting stent business continues to negatively impact the company’s quarterly sales.
Moreover, the guidance for 2015 was below expectations.
Stock Price: Shares are trending down in pre-market trading following the release.
Check back later for our full write up on this Abbott Labs earnings report later!
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