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Abbott (ABT) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
Asbury Automotive (ABG) possesses 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 $81.24, moving +0.62% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.47%. Elsewhere, the Dow gained 0.3%, while the tech-heavy Nasdaq added 1.05%.

Coming into today, shares of the maker of infant formula, medical devices and drugs had gained 5.65% in the past month. In that same time, the Medical sector gained 1.73%, while the S&P 500 lost 0.08%.

ABT will be looking to display strength as it nears its next earnings release. On that day, ABT is projected to report earnings of $0.80 per share, which would represent year-over-year growth of 9.59%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.99 billion, up 2.82% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.22 per share and revenue of $31.92 billion, which would represent changes of +11.81% and +4.4%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for ABT. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

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 is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note ABT's current valuation metrics, including its Forward P/E ratio of 25.1. This represents a discount compared to its industry's average Forward P/E of 26.02.

Also, we should mention that ABT has a PEG ratio of 2.27. 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 2.27 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 81, which puts it in the top 32% 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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