Abbott Laboratories
ABT
$100.57
+0.90%
Abbott Laboratories is a diversified healthcare company that manufactures and markets cardiovascular and diabetes devices, nutritional products, diagnostic equipment, and branded generic drugs. As a global leader in medical devices and diagnostics, Abbott derives roughly 60% of its sales outside the United States, giving it a distinct competitive advantage in emerging markets. The current investor narrative centers on the company's ability to navigate near-term headwinds after cutting its 2026 profit outlook, which overshadowed a solid first-quarter earnings beat and sent the stock sharply lower. Despite this, Abbott's 54-year dividend growth streak and strategic acquisitions like Exact Sciences continue to attract long-term income-focused investors.…
ABT
Abbott Laboratories
$100.57
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ABT 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Abbott Laboratories's 12-month outlook, with a consensus price target around $118.67 and implied upside of +18.0% versus the current price.
Average Target
$118.67
0 analysts
Implied Upside
+18.0%
vs. current price
Analyst Count
—
covering this stock
Price Range
$92 - $135
Analyst target range
Abbott is covered by 24 analysts, with a consensus recommendation of 'Buy' (mean rating 1.67 on a 1-5 scale where 1 is Strong Buy). The average target price is $116.54, implying approximately 15.8% upside from the current price of $100.68. The distribution leans heavily bullish, with no sell ratings and a majority of buy or outperform ratings. Recent ratings from firms like Evercore ISI, Piper Sandler, and Barclays have all maintained positive stances, indicating sustained institutional confidence despite the stock's decline. The target price range spans from a low of $92.00 to a high of $135.00, representing a spread of $43 or 37% of the average target. The high target of $135 assumes a full recovery to near the 52-week high, likely driven by successful execution of the Exact Sciences acquisition and margin expansion. The low target of $92 suggests further downside if the guidance cut materializes into weaker operational performance. The wide spread indicates elevated uncertainty, but the fact that the low target is still above the current price suggests that even the most bearish analyst sees limited downside. Overall, the analyst community remains constructive, with the average target offering double-digit upside potential.
Bulls vs Bears: ABT Investment Factors
Abbott presents a mixed picture: strong revenue growth, robust free cash flow, and a low forward P/E support the bull case, while a recent guidance cut, negative PEG, and persistent price weakness fuel bearish concerns. The bull case currently has stronger evidence given the attractive forward valuation and analyst consensus, but the key tension is whether the guidance cut is a temporary setback or a sign of deeper operational issues. Resolution of this uncertainty, likely by the next earnings report, will determine the stock's trajectory.
Bullish
- Attractive Forward P/E: Abbott's forward P/E of 16.6x is well below its historical average and the medical devices industry typical range of 20-25x. This suggests the stock is undervalued if earnings recover as expected, offering a margin of safety.
- Strong Revenue Growth: Q1 2026 revenue grew 7.8% YoY to $11.164B, accelerating from 4.3% growth in Q1 2025. All segments contributed, with Medical Devices and Diagnostics leading, indicating broad-based demand.
- Robust Free Cash Flow: Trailing twelve-month free cash flow is $7.378B, yielding ~3.4% on market cap. This cash generation supports the dividend (payout ratio 63%) and strategic acquisitions like Exact Sciences.
- Analyst Consensus Buy: 24 analysts rate Abbott a Buy with a mean rating of 1.67 (1=Strong Buy). The average target price of $116.54 implies 15.8% upside from $100.68, with no sell ratings.
Bearish
- Guidance Cut Overshadows Earnings: Abbott cut its 2026 profit outlook, which overshadowed a Q1 earnings beat and sent the stock sharply lower. This raises uncertainty about near-term earnings power and management credibility.
- Negative PEG Ratio: The PEG ratio is -0.65 due to negative earnings growth expectations, a red flag. This implies that the market expects earnings to decline, contradicting the low forward P/E narrative.
- Sustained Price Downtrend: The stock is down 16.5% over the past year vs. the S&P 500's +18.4%, and trades at 73.2% of its 52-week range. Relative strength is -34.8% over one year, indicating persistent underperformance.
- Elevated Trailing P/E: The trailing P/E of 33.5x is near the middle of its 5-year range (21-46x) but above the industry average. This suggests the stock is not cheap on past earnings, and multiple compression could occur if growth disappoints.
ABT Technical Analysis
Abbott is in a sustained downtrend, with the stock down 16.5% over the past year compared to the S&P 500's gain of 18.4%. The current price of $100.68 sits at 73.2% of its 52-week range (low $81.97, high $137.49), indicating it is closer to the low end and potentially oversold. This positioning near the bottom of the range suggests a value opportunity, but the negative relative strength of -34.8% over one year confirms persistent underperformance versus the market. Short-term momentum has improved significantly, with the stock up 13.8% over the past month and 4.0% over the past three months, diverging from the negative one-year trend. This divergence could signal a potential trend reversal or mean reversion, especially as the one-month relative strength of +13.5% versus the S&P 500 indicates recent outperformance. However, the stock remains 17.3% lower over six months, suggesting the recovery is still fragile. Key support lies at the 52-week low of $81.97, while resistance is at the 52-week high of $137.49. A breakout above $137.49 would signal a strong reversal, while a breakdown below $81.97 could accelerate selling. With a beta of 0.607, Abbott is significantly less volatile than the market, meaning it tends to decline less in downturns but also lag in rallies, which is consistent with its defensive healthcare profile.
Beta
0.61
0.61x market volatility
Max Drawdown
-40.2%
Largest decline past year
52-Week Range
$82-$137
Price range past year
Annual Return
-20.0%
Cumulative gain past year
| Period | ABT Return | S&P 500 |
|---|---|---|
| 1m | +14.5% | +0.4% |
| 3m | +8.7% | +5.5% |
| 6m | -6.4% | +8.4% |
| 1y | -20.0% | +18.9% |
| ytd | -19.0% | +9.6% |
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ABT Fundamental Analysis
Abbott's revenue trajectory remains solid, with Q1 2026 revenue of $11.164 billion growing 7.8% year-over-year, accelerating from the 4.3% growth in Q1 2025. The company's diversified segments are all contributing, with Medical Devices ($5.539B) and Diagnostic Products ($6.2B) as the primary growth drivers, while Nutritional Products ($2.017B) and Established Pharmaceuticals ($1.426B) provide stable recurring revenue. The multi-quarter trend shows consistent sequential growth from $10.358B in Q1 2025 to $11.164B in Q1 2026, indicating a healthy recovery trajectory despite macroeconomic headwinds. Profitability is robust, with Q1 2026 net income of $1.077 billion and a gross margin of 56.3%, which is slightly below the 57.0% in Q4 2025 but still healthy for the medical devices industry. Operating margin improved to 16.5% in Q1 2026 from 16.3% in Q1 2025, while net margin of 9.6% was lower than the 15.5% in Q4 2025 due to higher interest expenses and other costs. The company remains solidly profitable with a trailing twelve-month net income of $6.224 billion, and margins are stable, though not expanding significantly. Abbott's balance sheet is strong, with a debt-to-equity ratio of just 0.29 and a current ratio of 1.58, indicating ample liquidity. Free cash flow for Q1 2026 was $916 million, and trailing twelve-month free cash flow reached $7.378 billion, providing a free cash flow yield of approximately 3.4% based on the current market cap. The company generates sufficient cash to fund its dividend and capital expenditures, with a payout ratio of 63%, and its ROE of 12.5% reflects efficient capital allocation.
Quarterly Revenue
$11.2B
2026-03
Revenue YoY Growth
+7.8%
YoY Comparison
Gross Margin
56.3%
Latest Quarter
Free Cash Flow
$7.4B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is ABT Overvalued?
Since net income is positive, the primary valuation metric is the P/E ratio. Abbott's trailing P/E is 33.5x, while the forward P/E is 16.6x, implying that the market expects significant earnings growth in the coming year. The large gap between trailing and forward multiples suggests that the market is pricing in a sharp recovery in earnings, likely due to the recent guidance cut that depressed near-term expectations. Compared to the industry average (not provided, but medical devices typically trade at 20-25x forward earnings), Abbott's forward P/E of 16.6x appears attractive, though the trailing multiple is elevated. The PEG ratio is negative (-0.65) due to negative earnings growth expectations, which is a red flag. Historically, Abbott's trailing P/E has ranged from 21x to 46x over the past five years. The current trailing P/E of 33.5x is near the middle of that range, suggesting it is not excessively cheap or expensive. However, the forward P/E of 16.6x is near the lower end of its historical forward range (typically 15-25x), indicating that the stock may be undervalued relative to its own history if earnings recover as expected.
PE
33.5x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 21x~47x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
19.5x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Abbott's debt-to-equity ratio is low at 0.29, and the current ratio of 1.58 indicates ample liquidity. However, net margin declined to 9.6% in Q1 2026 from 15.5% in Q4 2025, driven by higher interest expenses and other costs. The payout ratio of 63% is manageable but leaves limited room for dividend growth if earnings contract. The guidance cut for 2026 introduces earnings uncertainty, and if revenue growth decelerates, the stock could face multiple compression from its trailing P/E of 33.5x.
Market & Competitive Risks: Abbott's beta of 0.607 makes it less volatile than the market, but its relative strength of -34.8% over one year shows it has underperformed significantly. The stock trades at a forward P/E of 16.6x, which is attractive but could be a value trap if earnings disappoint. Competitive pressures in medical devices and diagnostics are intense, and the Exact Sciences acquisition carries integration risk. Regulatory headwinds in international markets (60% of sales) could also impact growth.
Worst-Case Scenario: If the guidance cut materializes into sustained earnings weakness, the stock could fall to the analyst low target of $92.00, representing a -8.6% decline from $100.68. A more severe scenario, similar to the 52-week low of $81.97, would imply a -18.6% loss. Given the stock's max drawdown of -40.21%, a worst-case drop to $60 could occur in a severe recession, but this is unlikely given Abbott's defensive nature.