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Abbott (ABT) Gains As Market Dips: What You Should Know

Zacks Equity Research
Imax (IMAX) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Abbott (ABT) closed the most recent trading day at $78.67, moving +0.19% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.61%. At the same time, the Dow lost 0.72%, and the tech-heavy Nasdaq lost 0.56%.

Prior to today's trading, shares of the maker of infant formula, medical devices and drugs had gained 0.91% over the past month. This has lagged the Medical sector's gain of 2.13% and the S&P 500's gain of 5.68% in that time.

Wall Street will be looking for positivity from ABT as it approaches its next earnings report date. This is expected to be April 17, 2019. In that report, analysts expect ABT to post earnings of $0.61 per share. This would mark year-over-year growth of 3.39%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.48 billion, up 1.17% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.20 per share and revenue of $31.80 billion. These totals would mark changes of +11.11% and +4.01%, respectively, from last year.

Any recent changes to analyst estimates for ABT should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. ABT currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that ABT has a Forward P/E ratio of 24.52 right now. Its industry sports an average Forward P/E of 24.73, so we one might conclude that ABT is trading at a discount comparatively.

Meanwhile, ABT's PEG ratio is currently 2.09. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Medical - Products stocks are, on average, holding a PEG ratio of 2.34 based on yesterday's closing prices.

The Medical - Products industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 158, which puts it in the bottom 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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