On Thursday, BTIG remained positive on shares of Abbott Laboratories (NYSE:ABT), maintaining a Buy rating and a price target of $135. The firm highlighted Abbott's consistent performance and ability to surpass expectations, even while navigating the challenges posed by foreign exchange (Fx) headwinds.
Abbott's Device business units, particularly Electrophysiology (EP) and Structural Heart (SH), were noted for their strong results that contributed to this outlook.
The analyst from BTIG emphasized the company's ability to deliver top-tier growth in the Medical Devices sector, while effectively managing bottom-line performance despite Fx pressures, especially in emerging markets. The firm's updated revenue forecast for Abbott anticipates low-double-digit growth for the Devices segment in 2024.
Abbott's recent financial results were described as a solid demonstration of the company's sustainable growth potential. The firm's operational strategies are expected to continue to yield performance that exceeds market expectations.
While acknowledging the impact of foreign currency on the company's top-line and the ongoing legal challenges related to necrotizing enterocolitis (NEC) litigation, BTIG expressed confidence in Abbott's ability to outperform in sales and adjusted earnings per share (EPS) in the latter half of the year.
The investment firm's stance is backed by anticipated sales beats and adjustments to EPS, driven by growth in the Devices business and expansion through new products. The $135 price target set by BTIG is based on a 25x multiplier of the firm's 12-24 month adjusted EPS forecast for Abbott Laboratories.
Abbott Labs' stock rating and price target reaffirmation come as the company continues to navigate a complex global market, balancing growth aspirations with the realities of currency fluctuations and legal proceedings.
In other recent news, Abbott Laboratories reported robust Q2 results with earnings per share (EPS) of $1.14, surpassing street estimates by approximately 3%. This beat was attributed to improvements in operating margin and benefits from lower net interest expenses and foreign exchange gains.
The company's revenue growth was primarily fueled by its Medical Devices segment which outpaced street expectations. On the financial side, Abbott's gross margins surpassed expectations due to better execution, leading to an operating margin beat.
Evercore ISI maintained a positive outlook on Abbott Laboratories by reiterating an Outperform rating. Analysts from TD Cowen and Citi also maintained their Buy ratings on Abbott. In terms of product development, Abbott announced its 402nd consecutive quarterly dividend of 55 cents per share and received FDA clearance for two new over-the-counter continuous glucose monitoring systems, Lingo and Libre Rio.
Still, Abbott Laboratories is currently facing a trial over allegations that its baby formula for preterm infants is linked to a dangerous bowel disease. This litigation is separate from other ongoing legal issues Abbott is addressing, including the 2022 shutdown of its Sturgis, Michigan, plant and a baby formula recall. These are the latest in a series of recent developments for Abbott Laboratories.
InvestingPro Insights
Abbott Laboratories (NYSE:ABT) has shown resilience and strategic prowess, as noted by BTIG's positive outlook and $135 price target. Complementing this analysis, InvestingPro Tips highlight that Abbott has raised its dividend for 10 consecutive years and maintained dividend payments for an impressive 54 consecutive years, showcasing the company's commitment to delivering shareholder value. Abbott is recognized as a prominent player in the Healthcare Equipment & Supplies industry, with cash flows that can sufficiently cover interest payments, indicating a healthy financial position.
From a valuation perspective, the InvestingPro Data reveals a market capitalization of $173.93 billion and a P/E ratio of 31.06, which aligns with the company trading at a high earnings multiple. Revenue for the last twelve months as of Q1 2024 stood at $40.33 billion, with a gross profit margin of 55.26%, reflecting the company's robust profitability. Moreover, Abbott's dividend yield as of the specified date was 2.1%, coupled with a dividend growth of 7.84%, further solidifying its reputation as a reliable dividend-paying stock.
For investors seeking a more in-depth analysis, there are additional InvestingPro Tips available that could provide further insights into Abbott's performance and potential. To explore these tips and gain a comprehensive understanding of Abbott's investment profile, consider using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.