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

Zacks Equity Research
Activision Blizzard (ATVI) closed the most recent trading day at $45.14, moving -1.27% from the previous trading session.

Abbott (ABT) closed the most recent trading day at $79.50, moving -0.15% from the previous trading session. This change lagged the S&P 500's daily gain of 0.22%. At the same time, the Dow added 0.15%, and the tech-heavy Nasdaq gained 0.6%.

Coming into today, shares of the maker of infant formula, medical devices and drugs had gained 1.79% in the past month. In that same time, the Medical sector lost 0.07%, while the S&P 500 gained 2.39%.

ABT will be looking to display strength as it nears its next earnings release, which 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.

ABT's full-year Zacks Consensus Estimates are calling for earnings of $3.20 per share and revenue of $31.80 billion. These results would represent year-over-year changes of +11.11% and +4.01%, respectively.

Any recent changes to analyst estimates for ABT should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating 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).

Digging into valuation, ABT currently has a Forward P/E ratio of 24.86. For comparison, its industry has an average Forward P/E of 25.04, which means ABT is trading at a discount to the group.

Meanwhile, ABT's PEG ratio is currently 2.12. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Medical - Products stocks are, on average, holding a PEG ratio of 2.31 based on yesterday's closing prices.

The Medical - Products industry is part of the Medical sector. This group has a Zacks Industry Rank of 102, putting it in the top 40% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow ABT in the coming trading sessions, be sure to utilize Zacks.com.


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