We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Abbott (ABT) Down 0.7% Since Last Earnings Report: Can It Rebound?
Read MoreHide Full Article
It has been about a month since the last earnings report for Abbott (ABT - Free Report) . Shares have lost about 0.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Abbott 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.
Abbott's Q2 Earnings and Revenues Beat Estimates
Abbott reported second-quarter 2022 adjusted earnings of $1.43 per share, which exceeded the Zacks Consensus Estimate by 31.2%. The adjusted figure also improved 22.2% from the prior-year quarter’s levels.
The quarter’s adjustments include certain non-recurring intangible amortization expenses and other expenses primarily associated with restructuring actions, acquisitions and other expenses.
GAAP earnings per share came in at $1.14, surging 72.7% year on year.
Second-quarter worldwide sales of $11.26 billion were up 10.1% year over year on a reported basis. The top line exceeded the Zacks Consensus Estimate by 8.7%.
On an organic basis (excluding the impact of foreign exchange), sales improved 14.3% year over year in the reported quarter.
Quarter in Detail
Abbott operates through four segments — Established Pharmaceuticals, Medical Devices, Nutrition, and Diagnostics.
In the second quarter, Established Pharmaceuticals sales improved 3.7% on a reported basis (up 9.2% on an organic basis) to $1.22 billion. Organic sales in key emerging markets improved 7.1% year over year. According to Abbott, organic sales improvement was backed by double-digit growth in several geographies and therapeutic areas, including cardiometabolic, respiratory and central nervous system/pain management.
Medical Devices business sales improved 2.5% on a reported basis (up 7.5% on an organic basis) to $3.76 billion. Barring Neuromodulation and Vascular businesses, all other sub-segments in the quarter reported organic revenue growth.
Diabetes Care reported organic growth of 19.4% year over year, led by FreeStyle Libre, which contributed 25.6% to organic sales growth in the reported quarter. Heart Failure sales improved 8.3% organically. Meanwhile, the Rhythm Management business recorded single-digit organic growth of 0.9% in the quarter under review. Electrophysiology and Structural Heart recorded organic growth of 5% and 9.9%, respectively, in the quarter under review.
Nutrition sales were down 7.4% year over year on a reported basis (down 4.5% on an organic basis) to $1.95 billion. Pediatric Nutrition sales registered a 13.4% slump on an organic basis. The downside in both total worldwide Nutrition and Pediatric Nutrition sales can be attributed to a voluntary recall and manufacturing shutdown of certain infant formula products manufactured at one of Abbott's U.S. plants since last February.
Adult Nutrition sales improved 5.2% organically. Per the company, Adult Nutrition sales benefited from improved sales performance of Abbott's complete and balanced nutrition brand, Ensure, and diabetes nutrition brand, Glucerna.
Diagnostics sales were up 33.1% year over year on a reported basis (up 36.9% on an organic basis) to $4.32 billion. Core Laboratory Diagnostics sales were down 1.3% organically. Meanwhile, Molecular Diagnostics declined 24.2% on an organic basis. Rapid Diagnostics sales surged 84.6% on an organic basis, whereas Point of Care Diagnostics sales rose 2.4% organically.
Margins
Gross profit for the reported quarter rose 19.9% year over year to $6.32 billion. Gross margin expanded 457 basis points (bps) to 56.2%.
Selling, general and administrative expenses were up 1.1% year over year to $2.76 billion. Research and development expenses rose 4.6% year over year to $684 million.
The company reported an adjusted operating profit of $2.88 billion for the quarter under review. Adjusted operating margin, too, expanded 706 bps to 25.6%.
2022 Guidance
Abbott has raised its 2022 earnings per share guidance.
Full-year adjusted earnings from continuing operations (excluding specified items of $1.40 per share) are expected to be at least $4.90, up from previous expectation of adjusted earnings per share of at least $4.70. The current Zacks Consensus Estimate is pegged at $4.81.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -7.61% due to these changes.
VGM Scores
At this time, Abbott has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Abbott has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Abbott (ABT) Down 0.7% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Abbott (ABT - Free Report) . Shares have lost about 0.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Abbott 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.
Abbott's Q2 Earnings and Revenues Beat Estimates
Abbott reported second-quarter 2022 adjusted earnings of $1.43 per share, which exceeded the Zacks Consensus Estimate by 31.2%. The adjusted figure also improved 22.2% from the prior-year quarter’s levels.
The quarter’s adjustments include certain non-recurring intangible amortization expenses and other expenses primarily associated with restructuring actions, acquisitions and other expenses.
GAAP earnings per share came in at $1.14, surging 72.7% year on year.
Second-quarter worldwide sales of $11.26 billion were up 10.1% year over year on a reported basis. The top line exceeded the Zacks Consensus Estimate by 8.7%.
On an organic basis (excluding the impact of foreign exchange), sales improved 14.3% year over year in the reported quarter.
Quarter in Detail
Abbott operates through four segments — Established Pharmaceuticals, Medical Devices, Nutrition, and Diagnostics.
In the second quarter, Established Pharmaceuticals sales improved 3.7% on a reported basis (up 9.2% on an organic basis) to $1.22 billion. Organic sales in key emerging markets improved 7.1% year over year. According to Abbott, organic sales improvement was backed by double-digit growth in several geographies and therapeutic areas, including cardiometabolic, respiratory and central nervous system/pain management.
Medical Devices business sales improved 2.5% on a reported basis (up 7.5% on an organic basis) to $3.76 billion. Barring Neuromodulation and Vascular businesses, all other sub-segments in the quarter reported organic revenue growth.
Diabetes Care reported organic growth of 19.4% year over year, led by FreeStyle Libre, which contributed 25.6% to organic sales growth in the reported quarter. Heart Failure sales improved 8.3% organically. Meanwhile, the Rhythm Management business recorded single-digit organic growth of 0.9% in the quarter under review. Electrophysiology and Structural Heart recorded organic growth of 5% and 9.9%, respectively, in the quarter under review.
Nutrition sales were down 7.4% year over year on a reported basis (down 4.5% on an organic basis) to $1.95 billion. Pediatric Nutrition sales registered a 13.4% slump on an organic basis. The downside in both total worldwide Nutrition and Pediatric Nutrition sales can be attributed to a voluntary recall and manufacturing shutdown of certain infant formula products manufactured at one of Abbott's U.S. plants since last February.
Adult Nutrition sales improved 5.2% organically. Per the company, Adult Nutrition sales benefited from improved sales performance of Abbott's complete and balanced nutrition brand, Ensure, and diabetes nutrition brand, Glucerna.
Diagnostics sales were up 33.1% year over year on a reported basis (up 36.9% on an organic basis) to $4.32 billion. Core Laboratory Diagnostics sales were down 1.3% organically. Meanwhile, Molecular Diagnostics declined 24.2% on an organic basis. Rapid Diagnostics sales surged 84.6% on an organic basis, whereas Point of Care Diagnostics sales rose 2.4% organically.
Margins
Gross profit for the reported quarter rose 19.9% year over year to $6.32 billion. Gross margin expanded 457 basis points (bps) to 56.2%.
Selling, general and administrative expenses were up 1.1% year over year to $2.76 billion. Research and development expenses rose 4.6% year over year to $684 million.
The company reported an adjusted operating profit of $2.88 billion for the quarter under review. Adjusted operating margin, too, expanded 706 bps to 25.6%.
2022 Guidance
Abbott has raised its 2022 earnings per share guidance.
Full-year adjusted earnings from continuing operations (excluding specified items of $1.40 per share) are expected to be at least $4.90, up from previous expectation of adjusted earnings per share of at least $4.70. The current Zacks Consensus Estimate is pegged at $4.81.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -7.61% due to these changes.
VGM Scores
At this time, Abbott has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Abbott has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.