Diabetes Products To Drive Abbott's Q3

Core Viewpoint - Abbott Laboratories is expected to report Q3 2024 results on October 16, with projected revenue of $10.6 billion and earnings of $1.20 per share, in line with market expectations [1] Revenue and Earnings Summary - The company anticipates a mid-single-digit revenue increase driven by higher sales of FreeStyle Libre [1] - Abbott's Q2 2024 revenue was $10.4 billion, reflecting a 4% year-over-year growth, with medical devices up 10.2%, nutrition up 3.5%, and established pharmaceuticals up 0.6% [3] - The company expects total 2024 revenue to rise by 9.5% to 10% on an organic basis [3] Segment Performance - The Nutrition segment is expected to benefit from market share gains in baby formula products [2] - Medical devices are projected to see increased sales due to higher procedure volumes and demand for diabetes products, particularly FreeStyle Libre [2] - Abbott's COVID-19 testing sales were $305 million in Q3 2023, but this figure is expected to decline in Q3 2024, slightly offsetting growth in core laboratory diagnostics [2] Margin and Profitability - A slight rise in pre-tax margins is anticipated, contributing to bottom-line growth [2] - In Q2 2024, Abbott's adjusted pre-tax income margin expanded by 64 basis points year-over-year to 22.7% [3] Stock Valuation and Performance - Abbott's stock is considered fairly priced at $116, with an estimated valuation of $119 per share, based on a P/E ratio of 25 times expected earnings of $4.68 per share in 2024 [4] - The stock has shown volatility similar to the S&P 500, with expectations of sideways trading in the near term [4][5]