Back to top

Analyst Blog

Zacks Equity Research

Earnings Preview: Will Abbott Labs (ABT) Disappoint This Quarter?


 ZacksTrade Now

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at or call 800-767-3771 ext.  9339.

Abbott Laboratories (ABT - Analyst Report) is scheduled to report fourth quarter 2013 results before the opening bell on Jan 22, 2014. 

Last quarter, Abbott Labs posted a 7.84% positive surprise. On an average, Abbott Labs has posted a 4.57% positive surprise in the last four quarters. Let’s see how things are shaping up for the fourth quarter.

Factors to Influence 4Q Results

Abbott Labs is an extremely diversified company with its presence in the diagnostics, nutrition, generics and medical devices markets after having separated its pharmaceutical business into a new company called AbbVie (ABBV - Analyst Report) in Jan 2013.

However, the business environment was challenging in 2013 due to austerity measures in developed markets and weak economic conditions in developing markets. We believe the pricing pressure in the EU and health care reforms in the U.S. will have a negative impact on sales.

Moreover, we were disappointed by the disruption in international nutrition sales in the third quarter of 2013. The disruption is likely to stretch into the first half of 2014. The nutrition division is the company’s fastest growing business and hence a disruption in business will impact growth rates going forward. China is a key emerging market for Abbott Labs and the disruption is expected to negatively impact the bottom line by approximately 5 cents.

Earnings Whispers?

However, our proven model does not conclusively show that Abbott Labs will beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, #2 or #3 to be able to beat consensus estimates. That is not the case here as you will see below.

Zacks ESP:  The ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is 0.00%. This is because both the Most Accurate Estimate and Zacks Consensus Estimate currently stand at 58 cents.

Zacks Rank #3 (Hold): Abbott Labs’ Zacks Rank #3 (Hold) when combined with a 0.00% ESP makes surprise prediction difficult.

We caution against stocks with Zacks Ranks #4 and #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions. 

Stocks to Consider

Here are some large cap pharma stocks you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this season:

Eli Lilly and Company (LLY - Analyst Report) has Earnings ESP of +1.37% and holds a Zacks Rank #3. Eli Lilly will be reporting fourth quarter 2013 earnings on Jan 30, 2014.

Sanofi (SNY - Analyst Report) has earnings ESP of +2.27% and holds a Zacks Rank #3. Sanofi will report fourth quarter 2013 results on Feb 6, 2014.

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%