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Will Abbott Lab (ABT) Surprise Estimates in Q1 Earnings?
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Abbott Laboratories (ABT - Free Report) is scheduled to report first-quarter 2017 results before the opening bell on Apr 19. Last quarter, the company’s earnings exceeded the Zacks Consensus Estimate by 1.56%. Also, the company posted an average beat of 3.05% in the trailing four quarters. Let’s see how things are shaping up prior to this announcement.
Factors at Play
We are optimistic about Abbott’s strong and consistent Established Pharmaceuticals Division (EPD) and Medical Devices performances.
Within EPD, through a series of strategic actions, including the sale of Abbott’s developed markets business, the acquisitions of CFR Pharmaceuticals in Latin America and Veropharm in Russia, the company already achieved double-digit operational sales growth in fourth-quarter and full-year 2016. The company expects the same momentum to continue in the yet-to-be reported quarter.
With a leading market position in several geographies, including India, Russia and Latin America, EPD is believed to be well positioned for sustained above-market growth in some of the largest and fastest growing pharmaceutical markets in the world.
In 2017, the company plans to execute its existing operating model which focuses on portfolio selling in core therapeutic areas which will lead to the creation of unique channel opportunities in differentiated relationships with physicians, retailers and pharmacies that are looking to offer a complete line of solutions to treat prominent local health conditions.
Also, Abbott has plans to beef up its development capabilities with an expanded EPD innovation center in India. The center will act as a hub, shipping products to over 30 countries that will further develop differentiated products to suit local needs. Ffirst quarter onward, we expect a few of these executions to take place successfully, resulting in a top-line accretion.
Within medical device, we are looking forward to Abbott’s ongoing integration synergy, related to the St. Jude acquisition, which closed in January. The acquisition of St. Jude represents a major strategic move that establishes Abbott as a premier medical device business comprising cardiovascular, neuromodulation and diabetes care. These represent some of the largest and fastest growing areas of healthcare. We expect to see the ongoing synergy to ramp up the top line from the first quarter itself.
Notably, Abbott anticipates annual pre-tax synergies of $500 million by 2020, including revenue expansion opportunities as well as operational and SG&A efficiencies.
Overall, for the first quarter 2017, the company forecast adjusted earnings per share within 42 cents to 44 cents. Comparable operational sales growth for the quarter is expected in low single digits.
Earnings Whispers
Our proven model does not conclusively show that Abbott Laboratories is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.
Zacks ESP: Abbott’s Earnings ESP is 0.00% since both the Most Accurate estimate and the Zacks Consensus Estimate stand at 43 cents.
Zacks Rank: Abbott has a Zacks Rank #4 (Sell), which fails to increase the predictive power of ESP.
Also, we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are three companies you may want to consider as our proven model shows that they have the right combination of elements to post an earnings beat this quarter:
The Chemours Company (CC - Free Report) has an Earnings ESP of +4.08% and a Zacks Rank #1.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Hill-Rom Holdings, Inc. has an Earnings ESP of +1.27% and a Zacks Rank #2.
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While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public. Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Click here for Zacks' private trades >>
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Will Abbott Lab (ABT) Surprise Estimates in Q1 Earnings?
Abbott Laboratories (ABT - Free Report) is scheduled to report first-quarter 2017 results before the opening bell on Apr 19. Last quarter, the company’s earnings exceeded the Zacks Consensus Estimate by 1.56%. Also, the company posted an average beat of 3.05% in the trailing four quarters. Let’s see how things are shaping up prior to this announcement.
Factors at Play
We are optimistic about Abbott’s strong and consistent Established Pharmaceuticals Division (EPD) and Medical Devices performances.
Within EPD, through a series of strategic actions, including the sale of Abbott’s developed markets business, the acquisitions of CFR Pharmaceuticals in Latin America and Veropharm in Russia, the company already achieved double-digit operational sales growth in fourth-quarter and full-year 2016. The company expects the same momentum to continue in the yet-to-be reported quarter.
With a leading market position in several geographies, including India, Russia and Latin America, EPD is believed to be well positioned for sustained above-market growth in some of the largest and fastest growing pharmaceutical markets in the world.
Abbott Laboratories Price and EPS Surprise
Abbott Laboratories Price and EPS Surprise | Abbott Laboratories Quote
In 2017, the company plans to execute its existing operating model which focuses on portfolio selling in core therapeutic areas which will lead to the creation of unique channel opportunities in differentiated relationships with physicians, retailers and pharmacies that are looking to offer a complete line of solutions to treat prominent local health conditions.
Also, Abbott has plans to beef up its development capabilities with an expanded EPD innovation center in India. The center will act as a hub, shipping products to over 30 countries that will further develop differentiated products to suit local needs. Ffirst quarter onward, we expect a few of these executions to take place successfully, resulting in a top-line accretion.
Within medical device, we are looking forward to Abbott’s ongoing integration synergy, related to the St. Jude acquisition, which closed in January. The acquisition of St. Jude represents a major strategic move that establishes Abbott as a premier medical device business comprising cardiovascular, neuromodulation and diabetes care. These represent some of the largest and fastest growing areas of healthcare. We expect to see the ongoing synergy to ramp up the top line from the first quarter itself.
Notably, Abbott anticipates annual pre-tax synergies of $500 million by 2020, including revenue expansion opportunities as well as operational and SG&A efficiencies.
Overall, for the first quarter 2017, the company forecast adjusted earnings per share within 42 cents to 44 cents. Comparable operational sales growth for the quarter is expected in low single digits.
Earnings Whispers
Our proven model does not conclusively show that Abbott Laboratories is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.
Zacks ESP: Abbott’s Earnings ESP is 0.00% since both the Most Accurate estimate and the Zacks Consensus Estimate stand at 43 cents.
Zacks Rank: Abbott has a Zacks Rank #4 (Sell), which fails to increase the predictive power of ESP.
Also, we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are three companies you may want to consider as our proven model shows that they have the right combination of elements to post an earnings beat this quarter:
Applied Materials, Inc. (AMAT - Free Report) has an Earnings ESP of +1.32% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Chemours Company (CC - Free Report) has an Earnings ESP of +4.08% and a Zacks Rank #1.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Hill-Rom Holdings, Inc. has an Earnings ESP of +1.27% and a Zacks Rank #2.
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public. Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Click here for Zacks' private trades >>