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Abbott Labs (ABT) Down 2.3% Since Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for Abbott Laboratories (ABT - Free Report) . Shares have lost about 2.3% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock’s next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Recent Earnings
Abbott Labs reported first-quarter 2017 adjusted earnings from continuing operations of $0.48 per share, 11.6% higher than the Zacks Consensus Estimate and up 17.1% year over year.
Reported earnings for the quarter came in at $0.22 per share, way ahead of the year-ago number of $0.04.
First-quarter worldwide sales came in at $6.33 billion, up 29.7% year over year on a reported basis. The quarterly figure also remains ahead of the Zacks Consensus Estimate of $6.11 billion. On a comparable operational basis (adjusting the impact of foreign exchange, certain acquisitions and divestments) sales increased 3.2% year over year in the reported quarter.
Quarter in Detail
Abbott Labs operates through four segments – Established Pharmaceuticals Division (EPD), Medical Devices, Nutrition and Diagnostics.
EPD sales were up 7% on a reported basis (up 5.7% on comparable operational basis) to $950 billion. There was a positive impact of 1.3% due to currency fluctuations. Sales in key emerging markets increased 15.2% (up 12.5%) driven by commercial initiatives and locally relevant portfolio expansion. Sales in Other segment declined 13.4% (down 11.3%) to $220 million on poor Venezuelan operations.
The Medical Devices business sales spiked 100.2% on a reported basis on St. Jude inclusion to $2.39 billion. However, on a comparable operational basis, sales increased 4.5%.
Cardiovascular and Neuromodulation sales increased 207% on a reported basis (up 2.4% on comparable operational basis) on double-digit growth in Electrophysiology, Structural Heart and Neuromodulation. Vascular product sales were up 0.1% on a comparable operational basis on the back of double-digit growth in MitraClip. Also, strong sales growth in Abbott's Endovascular business was driven by vessel closure products and Supera.
Diabetes Care sales increased 20.2% on a reported basis (up 22.9%), driven by double-digit international sales growth led by continued consumer uptake of FreeStyle Libre, Abbott's revolutionary continuous glucose monitoring system.
Nutrition sales decreased 1.7% year over year on a reported basis (down 1% on a comparable operational basis). Unfavorable foreign exchange impacted sales by 0.7%. Pediatric Nutrition sales decreased 3.3% on a comparable operational basis. Adult Nutrition sales however, increased 2% on a comparable operational basis.
Diagnostics sales increased 3.6% year over year (up 4.7% on a comparable operational basis). While Core Laboratory sales increased 4.3%, Point of Care Diagnostics sales increased 7.5%, both on a comparable operational basis. Molecular Diagnostics sales were up 3.9% as strong growth in the infectious disease testing business was partially offset by the planned scale-down of the genetics business.
2017 Guidance
Abbott Labs reiterated its full-year 2017 guidance. The company still forecasts earnings per share from continuing operations to remain within the range of $0.92 to $1.02. Adjusting certain net specified items for the full year of approximately $1.48 per share, adjusted earnings per share from continuing operations is expected to stay within the range of $2.40 to $2.50. The current Zacks Consensus Estimate is pegged at $2.45, at the midpoint of the projected range.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
At this time, Abbott Labs' stock has a subpar Growth Score of 'D', a grade with the same score on the momentum front. However, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'C'. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our styles scores, the stock is suitable solely for value investors.
Outlook
The stock has a Zacks Rank #2 (Buy). We are looking for an above average return from the stock in the next few months.
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Abbott Labs (ABT) Down 2.3% Since Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Abbott Laboratories (ABT - Free Report) . Shares have lost about 2.3% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock’s next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Recent Earnings
Abbott Labs reported first-quarter 2017 adjusted earnings from continuing operations of $0.48 per share, 11.6% higher than the Zacks Consensus Estimate and up 17.1% year over year.
Reported earnings for the quarter came in at $0.22 per share, way ahead of the year-ago number of $0.04.
First-quarter worldwide sales came in at $6.33 billion, up 29.7% year over year on a reported basis. The quarterly figure also remains ahead of the Zacks Consensus Estimate of $6.11 billion. On a comparable operational basis (adjusting the impact of foreign exchange, certain acquisitions and divestments) sales increased 3.2% year over year in the reported quarter.
Quarter in Detail
Abbott Labs operates through four segments – Established Pharmaceuticals Division (EPD), Medical Devices, Nutrition and Diagnostics.
EPD sales were up 7% on a reported basis (up 5.7% on comparable operational basis) to $950 billion. There was a positive impact of 1.3% due to currency fluctuations. Sales in key emerging markets increased 15.2% (up 12.5%) driven by commercial initiatives and locally relevant portfolio expansion. Sales in Other segment declined 13.4% (down 11.3%) to $220 million on poor Venezuelan operations.
The Medical Devices business sales spiked 100.2% on a reported basis on St. Jude inclusion to $2.39 billion. However, on a comparable operational basis, sales increased 4.5%.
Cardiovascular and Neuromodulation sales increased 207% on a reported basis (up 2.4% on comparable operational basis) on double-digit growth in Electrophysiology, Structural Heart and Neuromodulation. Vascular product sales were up 0.1% on a comparable operational basis on the back of double-digit growth in MitraClip. Also, strong sales growth in Abbott's Endovascular business was driven by vessel closure products and Supera.
Diabetes Care sales increased 20.2% on a reported basis (up 22.9%), driven by double-digit international sales growth led by continued consumer uptake of FreeStyle Libre, Abbott's revolutionary continuous glucose monitoring system.
Nutrition sales decreased 1.7% year over year on a reported basis (down 1% on a comparable operational basis). Unfavorable foreign exchange impacted sales by 0.7%. Pediatric Nutrition sales decreased 3.3% on a comparable operational basis. Adult Nutrition sales however, increased 2% on a comparable operational basis.
Diagnostics sales increased 3.6% year over year (up 4.7% on a comparable operational basis). While Core Laboratory sales increased 4.3%, Point of Care Diagnostics sales increased 7.5%, both on a comparable operational basis. Molecular Diagnostics sales were up 3.9% as strong growth in the infectious disease testing business was partially offset by the planned scale-down of the genetics business.
2017 Guidance
Abbott Labs reiterated its full-year 2017 guidance. The company still forecasts earnings per share from continuing operations to remain within the range of $0.92 to $1.02. Adjusting certain net specified items for the full year of approximately $1.48 per share, adjusted earnings per share from continuing operations is expected to stay within the range of $2.40 to $2.50. The current Zacks Consensus Estimate is pegged at $2.45, at the midpoint of the projected range.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
Abbott Laboratories Price and Consensus
Abbott Laboratories Price and Consensus | Abbott Laboratories Quote
VGM Scores
At this time, Abbott Labs' stock has a subpar Growth Score of 'D', a grade with the same score on the momentum front. However, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'C'. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our styles scores, the stock is suitable solely for value investors.
Outlook
The stock has a Zacks Rank #2 (Buy). We are looking for an above average return from the stock in the next few months.