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Abbott (ABT) Gains As Market Dips: What You Should Know

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Abbott (ABT - Free Report) closed at $105.19 in the latest trading session, marking a +0.72% move from the prior day. This move outpaced the S&P 500's daily loss of 0.48%. At the same time, the Dow lost 0.48%, and the tech-heavy Nasdaq lost 0.29%.

Coming into today, shares of the maker of infant formula, medical devices and drugs had lost 4.59% in the past month. In that same time, the Medical sector lost 1.66%, while the S&P 500 lost 4.3%.

Investors will be hoping for strength from ABT as it approaches its next earnings release, which is expected to be October 21, 2020. On that day, ABT is projected to report earnings of $0.89 per share, which would represent year-over-year growth of 5.95%. Meanwhile, our latest consensus estimate is calling for revenue of $8.43 billion, up 4.4% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.27 per share and revenue of $32.88 billion. These totals would mark changes of +0.93% and +3.05%, respectively, from last year.

Any recent changes to analyst estimates for ABT should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. ABT is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, ABT currently has a Forward P/E ratio of 31.91. Its industry sports an average Forward P/E of 38.78, so we one might conclude that ABT is trading at a discount comparatively.

Meanwhile, ABT's PEG ratio is currently 2.9. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Medical - Products was holding an average PEG ratio of 3.85 at yesterday's closing price.

The Medical - Products industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 174, which puts it in the bottom 32% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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