Market Overview

An Abbott Labs Analyst's 5 Reasons To Own The Stock: 'Near-Perfect For This Environment'

Share:
An Abbott Labs Analyst's 5 Reasons To Own The Stock: 'Near-Perfect For This Environment'

Health care company Abbott Laboratories (NYSE: ABT) has had a strong start to the year with forecast-beating first-quarter results and in-line full-year guidance.

The Analyst

Raymond James analyst Jayson Bedford maintained an Outperform rating on Abbott with a $79 price target.

The Thesis

Abbott shares are likely to outperform, and there are far more reasons to own the stock than not, Bedford said in a Wednesday note. (See his track record here.)

Abbott has an above-average growth profile, with 7-percent top-line growth and over 15-percent EPS growth, excluding forex, the analyst said. This is one of the most attractive profiles in the health care group, he said. 

The Illinois company has four key product-line drivers, Bedford said: Mitraclip, Libre, Heartmate 3 and Alinity/Core Lab. Together, they accounted for 23 percent of first-quarter sales. The analyst said he expects these products to sustain the 17-percent growth witnessed in the first quarter.

Abbott is well-diversified, with only 37 percent of its revenue coming from the U.S., Bedford said. 

The portfolio is diversified as well, with 24 percent of revenue coming from nutrition and 13 percent from branded generics, the analyst said. 

Raymond James noted that Abbott has been consistently meeting and exceeding consensus estimates in each of the past 21 quarters.

These positives more than offset twin negatives, Bedford said: premium valuation and perceived macro issues facing the health care sector.

" ... As the dust settles ... we expect the stock to outperform." 

Raymond James raised its 2019 estimates for Abbott slightly on the basis of the first-quarter print and strong second-quarter guidance of 7-percent organic growth and adjusted EPS of 79-81 cents.  

Abbott shares were trading up 0.48 percent to $73.21 at the time of publication Thursday. 

Related Links:

Mustang Bio Gallops Higher On Positive Gene Therapy Results For Deadly 'Bubble Boy Disease'

The Daily Biotech Pulse: Hookipa To Debut, Mustang Bio Skyrockets, AngioDynamics Sheds Portfolio

Public domain photo via Wikimedia. 

Latest Ratings for ABT

DateFirmActionFromTo
Jan 2019MaintainsOverweightOverweight
Jan 2019DowngradesNeutralSell
Dec 2018Initiates Coverage OnOutperform

View More Analyst Ratings for ABT
View the Latest Analyst Ratings

Posted-In: Jayson BedfordAnalyst Color Earnings News Guidance Price Target Reiteration Analyst Ratings Best of Benzinga

 

Related Articles (ABT)

View Comments and Join the Discussion!

Benzinga Pro Movers: Mustang Bio Shares Spike After Clinical Trial Data Is Released

Raymond James Boosts Kansas City Southern Price Target After Q1 Beat