Abbott Laboratories' 3Q Preview

JP Morgan has issued a research report on Abbott Laboratories ABT previewing the company's 3Q results. In the report, JP Morgan writes "For the quarter, our model calls for EPS of $1.04 (+13.0%), which is inline with consensus and at the midpoint of management's guidance range of $1.03-1.05. On the top line, sales are forecast at $8.75B (+12.7% reported, +3.5% organic), which is $196M (220bps) below consensus. We expect Solvay to contribute revenue of $900M, while FX is projected to negatively impact results by $140M (-1.8%) and healthcare reform is expected to weigh on the top line by roughly $55M (-0.7%). The biggest disconnect between our revenue forecast and consensus stems from the $100M impact from the Similac recall, which appears to still be in Street models. As a reminder, Abbott announced a Similac recall on September 22 but reaffirmed 3Q EPS guidance ($1.03-$1.05). We expect management to address the timeline for resolution of this issue in more detail on the 3Q call." JP Morgan maintains its Overweight rating and has raised the price target from $55 to $60. Abbott Laboratories closed yesterday at $53.51.