Shares of Abbott Laboratories (NYSE: ABT) recently plunged after the company announced its fourth-quarter results. Over the trailing 12 months, the stock is down 16%. Some might choose to stay away from Abbott given some recent challenges. However, Abbott's stock still remains attractive, especially for dividend-seeking investors. Here is why. Abbott's quarterly update Abbott Laboratories' fourth-quarter top-line growth came up short of expectations. The company's sales were $11.5 billion, up 4.4% compa ...

Financial Data and Key Metrics Changes - In Q4 2025, sales increased by 3.8% excluding COVID testing sales, with adjusted earnings per share (EPS) of $1.50 reflecting a growth of 12% compared to the prior year [18] - Adjusted gross margin was 57.1% of sales, an increase of 20 basis points year-over-year, while adjusted operating margin rose to 25.8%, reflecting an increase of 150 basis points [18] - The company forecasts adjusted EPS for 2026 to be in the range of $5.55-$5.80, indicating a 10% growth at the midpoint [19] Business Line Data and Key Metrics Changes - Nutrition sales declined in Q4, impacted by market share loss and increased manufacturing costs, with a focus on reigniting volume growth through price and promotion initiatives [9][10] - Diagnostics sales decreased by 3.5% due to a decline in COVID testing, while Core Lab Diagnostics grew by 3.5%, achieving accelerating growth [11] - EPD (Established Pharmaceuticals Division) saw a 7% increase in sales, with double-digit growth in India and several Latin American and Middle Eastern countries [12] - Medical devices sales grew by 10.5%, driven by a 12% increase in continuous glucose monitors and strong performance in electrophysiology and structural heart segments [12][14] Market Data and Key Metrics Changes - The U.S. pediatric nutrition business faced challenges due to market share loss and increased price sensitivity among consumers [9][10] - Core Lab Diagnostics growth was 7% excluding China, reflecting durable demand globally [11] - EPD's growth was well-balanced across markets, with significant contributions from emerging markets [12] Company Strategy and Development Direction - The company aims to transition back to a more balanced growth profile, focusing on volume growth alongside price increases [10] - The acquisition of Exact Sciences is expected to enhance Abbott's position in the cancer diagnostics market, adding a high-growth business to its portfolio [8] - The company plans to launch at least eight new products in the nutrition segment over the next 12 months to support growth [10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges in the nutrition business but expressed confidence in the ability to reignite volume growth and return to positive growth in the second half of 2026 [27] - The company expects continued momentum in most business segments, with a focus on innovation and operational excellence driving growth [8][29] - Management highlighted the importance of addressing price sensitivity and the need for a sustainable growth strategy in the nutrition segment [25][27] Other Important Information - The company anticipates a favorable impact from foreign exchange on full-year reported sales, estimated at around 1% [19] - The adjusted tax rate is forecasted to be in the range of 15%-16% for the year [19] Q&A Session Summary Question: Concerns about revenue growth guidance - Management acknowledged a slight reduction in top-line guidance primarily due to challenges in the nutrition business but maintained EPS guidance in line with consensus [23][24] Question: Insights on the EP product portfolio - Management emphasized the successful launch of the Vault PFA catheter and the strategic positioning of Abbott's EP portfolio, expecting to grow in line with market trends [34][39] Question: Guidance considerations and risk adjustments - Management explained that the guidance reflects a mix of stable growth in core segments and anticipated recovery in diagnostics, with a focus on maintaining high single-digit growth [42][45] Question: Continuous glucose monitor (CGM) growth expectations - Management projected continued strong growth in CGM sales, driven by market expansion opportunities and new product launches [50][56] Question: Capital allocation and M&A strategy - Management indicated a focus on integrating Exact Sciences post-acquisition, with potential for smaller tuck-in acquisitions in the future [69][70]

Financial Data and Key Metrics Changes - In Q4 2025, sales increased by 3.8% excluding COVID testing sales, with adjusted earnings per share (EPS) of $1.50 reflecting a growth of 12% compared to the prior year [18] - Adjusted gross margin was 57.1% of sales, an increase of 20 basis points year-over-year, while adjusted operating margin rose by 150 basis points to 25.8% [18] - The company forecasts adjusted EPS for 2026 to be in the range of $5.55-$5.80, indicating a 10% growth at the midpoint [19] Business Line Data and Key Metrics Changes - Nutrition sales declined in Q4, impacted by market share loss and increased manufacturing costs, with a focus on reigniting volume growth through price and promotion initiatives [9][10] - Diagnostics sales decreased by 3.5% due to a decline in COVID testing, but Core Lab Diagnostics grew by 3.5%, with a full-year growth of 7% excluding China [11] - EPD (Established Pharmaceuticals Division) saw a 7% sales increase, with double-digit growth in India and several Latin American and Middle Eastern countries [12] - Medical devices sales grew by 10.5%, driven by a 12% increase in continuous glucose monitors (CGM) and strong performance in electrophysiology and structural heart segments [12][14] Market Data and Key Metrics Changes - The U.S. pediatric nutrition business faced challenges due to a loss of a large WIC contract, leading to a need for volume growth strategies [9] - Core Lab Diagnostics experienced durable demand globally, with growth in markets outside of China [11] - EPD's growth was well-balanced across markets, with significant contributions from emerging markets [12] Company Strategy and Development Direction - The company aims to transition back to a volume-driven growth model in nutrition, with plans to launch at least eight new products in the next 12 months [10] - The acquisition of Exact Sciences is expected to enhance Abbott's position in the cancer diagnostics market, adding a high-growth business to its portfolio [8] - The company is focused on innovation and operational excellence to drive growth in 2026, with a forecast of 7% organic sales growth [8] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the nutrition segment due to price sensitivity among consumers and the need for a sustainable growth model [9][10] - The outlook for 2026 includes expectations of accelerating growth in diagnostics and continued strong performance in cardiovascular and diabetes products [29] - Management expressed confidence in the ability to navigate short-term challenges in nutrition and return to growth in the second half of the year [27] Other Important Information - The company is committed to maintaining a growing dividend and has a strong balance sheet to support future investments [70] - Management emphasized the importance of integrating Exact Sciences post-acquisition and the potential for tuck-in acquisitions in the future [70] Q&A Session Summary Question: Concerns about revenue growth guidance - Management acknowledged a slight reduction in top-line guidance primarily due to challenges in the nutrition business but maintained EPS guidance in line with consensus [23][24] Question: Insights on the electrophysiology (EP) portfolio - Management highlighted the successful launch of Volt and TactiFlex Duo products, positioning Abbott favorably in the EP market with a comprehensive portfolio [34][39] Question: Guidance considerations and risk adjustments - Management discussed the balance of sustaining growth in core segments while addressing short-term challenges in nutrition, with expectations for mid-single-digit growth in diagnostics [42][45] Question: Continuous glucose monitor (CGM) market outlook - Management expressed optimism about CGM growth, projecting continued market expansion and penetration opportunities across various patient groups [52][56] Question: Capital allocation and Exact Sciences acquisition - Management confirmed focus on integrating Exact Sciences and maintaining a strong capital allocation strategy, with no immediate changes to dilution expectations [70][72]

Financial Data and Key Metrics Changes - In Q4 2025, Abbott reported a 3.8% increase in sales when excluding COVID testing sales, with adjusted earnings per share (EPS) of $1.50 reflecting a 12% growth compared to the prior year [19] - The adjusted gross margin was 57.1% of sales, an increase of 20 basis points year-over-year, while adjusted operating margin rose to 25.8%, reflecting a 150 basis point increase [19] - For 2026, Abbott forecasts adjusted EPS in the range of $5.55-$5.80, indicating a 10% growth at the midpoint, and organic sales growth expected to be between 6.5%-7.5% [20] Business Line Data and Key Metrics Changes - Nutrition sales declined in Q4 due to market share loss and increased manufacturing costs, with a focus on reigniting volume growth through price and promotion initiatives [9][10] - Diagnostics sales decreased by 3.5% due to a decline in COVID testing, while Core Lab Diagnostics grew by 3.5%, and point-of-care diagnostics saw a 7% increase driven by a new troponin test [12] - The Established Pharmaceutical Division (EPD) experienced a 7% sales increase, with double-digit growth in India and several Latin American and Middle Eastern countries [13] - Medical devices sales grew by 10.5%, with continuous glucose monitors (CGM) sales increasing by 12% in Q4 and 17% for the year, exceeding $7.5 billion [13][14] Market Data and Key Metrics Changes - The U.S. pediatric nutrition business faced challenges due to a loss of a large WIC contract, impacting overall sales [10] - Core Lab Diagnostics growth was 7% excluding China, reflecting durable demand globally [12] - EPD's growth was well-balanced across markets, with significant contributions from high-demand therapies in emerging markets [13] Company Strategy and Development Direction - Abbott's acquisition of Exact Sciences aims to enhance its position in the cancer diagnostics market, adding a high-growth business to its portfolio [8] - The company is focusing on innovation and operational excellence, with a forecast for 2026 driven by new product launches and strategic execution [8] - Abbott plans to transition its nutrition business back to a volume-driven growth model, emphasizing innovation and product development [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the nutrition segment due to price sensitivity among consumers and rising manufacturing costs, indicating a need for strategic changes [10][26] - The outlook for 2026 is optimistic, with expectations of accelerating growth driven by a strong product pipeline and the integration of Exact Sciences [30][47] - Management expressed confidence in the ability to navigate short-term challenges in nutrition and return to positive growth in the second half of the year [28][29] Other Important Information - Abbott's investment strategy in medical devices focuses on sustaining strong performance in high-growth segments while also investing in foundational segments [15][16] - The company is committed to maintaining a growing dividend and has a strong balance sheet to support future investments [70] Q&A Session Summary Question: Concerns about revenue growth guidance - Management acknowledged a slight reduction in top-line guidance primarily due to challenges in the nutrition business but maintained EPS guidance in line with consensus [24][25] Question: Insights on the EP product portfolio - Management highlighted the successful launch of the Vault catheter and the strategic positioning of Abbott's EP portfolio, expecting to grow in line with market trends [39] Question: Outlook for diagnostics in China - Management indicated that while growth in China is expected to be stable, the U.S. and other international markets are performing well, with an overall mid-single-digit growth outlook for diagnostics [84] Question: Future of CGM growth - Management expressed optimism about CGM growth, projecting continued market expansion and penetration opportunities across various patient segments [54][58] Question: Capital allocation and M&A strategy - Management emphasized the focus on integrating Exact Sciences post-acquisition while remaining open to smaller tuck-in acquisitions [70][71]

Core Insights - Abbott Laboratories (ABT) is expected to report its fourth-quarter 2025 results on January 22, with adjusted earnings per share (EPS) of $1.30 in the last quarter, matching the Zacks Consensus Estimate [1] - The Zacks Consensus Estimate for revenues is $11.79 billion, indicating a 7.5% increase year-over-year, while EPS is projected to rise by 11.9% to $1.50 [2] Q4 Estimates - Revenue growth for the Diagnostics segment is anticipated to be impacted by volume-based procurement programs in China, with a projected increase of 0.8% year-over-year [3][4] - The Established Pharmaceuticals (EPD) segment is expected to show strong performance across 15 key markets, with an estimated revenue increase of 8.5% year-over-year, driven by demand in therapeutic areas such as gastroenterology and cardiometabolic [5][6] - The Medical Devices segment is projected to see a 12.5% year-over-year revenue improvement, supported by strong sales in Diabetes Care and Electrophysiology [7][13] - The Nutrition division is expected to grow by 3.3%, bolstered by new product launches in adult nutrition brands [8][15] Estimate Revision Trend - Estimates for Q4 earnings have remained unchanged at $1.50 per share over the past 30 days, indicating stability in expectations [3] Segment Performance - The Diagnostics segment's growth is likely to be sustained by global demand for routine diagnostic testing, particularly in the U.S. market [4] - The Medical Devices segment's growth is attributed to advancements in various divisions, including the launch of new products and regulatory approvals [10][12] - The Nutrition segment's growth is driven by the introduction of low-sugar formulas and new protein shakes, which are expected to enhance sales [14]

24/7 Wall St. Quick Read Abbott Laboratories (ABT) grew revenue 6.9% with medical devices up 14.8% to $5.45B. Abbott reaffirmed guidance for 7.5-8.0% organic growth. Eli Lilly (LLY) posted 54% revenue growth driven by Mounjaro ($6.52B) and Zepbound ($3.57B). Lilly raised guidance to $63.0-63.5B revenue. Lilly’s operating margin reached 48.3% versus Abbott’s 19.4%. Lilly trades at 49.5x P/E while Abbott trades at 15.71x. If you’re thinking about retiring or know someone who is, there are three quic ...

Core Insights - Abbott Laboratories and Eli Lilly reported fundamentally different Q3 earnings, with Abbott showing steady growth driven by medical devices and Lilly experiencing explosive growth from GLP-1 drugs [1] Abbott Laboratories - Abbott's revenue grew by 6.9% year-over-year, primarily supported by its medical device segment, which increased by 14.8% to $5.45 billion [2] - The cardiovascular portfolio, including TriClip and Navitor TAVI, significantly contributed to growth, while the diagnostics segment saw a decline of 6.6% due to reduced COVID testing revenue [2] - Abbott's operating income rose by 13.1% to $2.06 billion, but net income remained flat year-over-year [2] - The company reaffirmed its outlook for 7.5-8.0% organic growth, excluding COVID testing [3] Eli Lilly - Lilly's revenue surged by 54% year-over-year to $17.60 billion, exceeding estimates by 9.5% [3] - The incretin portfolio, particularly Mounjaro and Zepbound, generated significant revenue, with Mounjaro alone contributing $6.52 billion (up 109%) and Zepbound adding $3.57 billion (up 184%) [3] - Net income for Lilly jumped 475% to $5.58 billion, with an operating margin of 48.3%, nearly double that of Abbott [3] - Lilly raised its full-year revenue guidance to $63.0-63.5 billion and non-GAAP EPS to $23.00-23.70 [3] Business Models - Abbott's diversified business model spreads risk across various segments, including medical devices, diagnostics, nutrition, and branded generics, limiting upside but cushioning downside [5] - In contrast, Lilly's concentrated focus on incretin-based therapies has resulted in over $10 billion in quarterly revenue from Mounjaro and Zepbound, but this concentration also creates vulnerability to market fluctuations [6] Future Outlook - For Abbott, the key focus will be on whether the momentum in cardiovascular devices can offset the decline in diagnostics, with the success of TriClip's Japan launch and Navitor's European expansion being critical [7] - For Lilly, effective supply chain execution is essential to meet demand and maintain its market position, especially as it expands manufacturing capacity [8] Risk Profiles - Abbott trades at a P/E ratio of 15.71 with a 1.88% dividend yield, reflecting a mature business model [9] - Lilly, with a P/E ratio of 49.5, indicates high growth expectations tied to its GLP-1 dominance, but this also implies higher concentration risk [9]

Core Insights - The cardiovascular medical device sector is highly competitive, with major multinational companies like Johnson & Johnson, Medtronic, Abbott, and Boston Scientific actively showcasing their innovations at the China International Import Expo (CIIE) [1][2][3] Group 1: Johnson & Johnson's Innovations - Johnson & Johnson's Impella device, an interventional artificial heart device, is nearing the final registration stage in China, expected to be approved by the end of this year or early next year [1] - Impella is the only device globally approved by the FDA that has been shown to improve survival rates in patients with cardiogenic shock [1] - The company emphasizes that the CIIE serves as an accelerator for introducing advanced medical technologies to China, garnering attention from regulatory bodies and healthcare professionals [1] Group 2: Competitive Landscape - Medtronic showcased a newly FDA-approved ultra-stiff guidewire, aimed at enhancing the stability and safety of transcatheter aortic valve replacement (TAVR) procedures, with plans to introduce it to the Chinese market [2] - The field of cardiac electrophysiology is witnessing the emergence of pulsed field ablation (PFA) technology, with multiple imported and domestic PFA products already approved in China, intensifying market competition [2] - Abbott presented the TriClip device for transcatheter heart valve repair, which has already been used in 10 patients in the Greater Bay Area and is expected to receive formal approval next year [3] Group 3: Technological Advancements - Siemens Healthineers introduced a DSA angiography device capable of generating 3D-like CT images in 2.5 seconds, integrating AI technologies for precise guidance in cardiovascular interventions [3] - The increasing display of advanced cardiovascular medical devices at the CIIE allows the public to engage with cutting-edge surgical equipment, highlighting the need for reasonable pricing models to make these therapies accessible to more patients [3]

Core Insights - Abbott's Q3 2025 financial report shows a global sales of $11.369 billion, a year-on-year increase of 6.9%, with organic growth of 5.5% excluding foreign exchange impacts [2] - The adjusted diluted earnings per share (EPS) is $1.30, reflecting a 7.4% increase year-on-year, and the operating margin improved to 23.0% [2] - The company maintains its full-year guidance, expecting organic growth of 7.5%–8.0% excluding COVID-19 testing impacts, with adjusted EPS narrowed to $5.12–$5.18, indicating double-digit growth [2][24] Business Breakdown Medical Devices - Medical device sales reached $5.448 billion, a 14.8% increase year-on-year, with organic growth of 12.5%, making it the core driver of overall performance [4] - Key growth areas include diabetes care, particularly the continuous glucose monitoring (CGM) products, which generated approximately $2.057 billion in sales [4][6] Diagnostics - Diagnostics sales totaled $2.253 billion, down 6.6% year-on-year, primarily due to a significant decline in COVID-19 testing revenue [8] - Excluding COVID-19 testing, the diagnostics business showed slight positive growth of 0.4%, indicating resilience in core operations [8] Nutrition - Nutrition sales amounted to $2.153 billion, with organic growth of 4.0%, driven by strong performance in adult nutrition products [10] - Adult nutrition products like Ensure and Glucerna are gaining traction among aging and diabetes management populations [10] Established Pharmaceuticals - International sales in established pharmaceuticals reached $1.511 billion, with a year-on-year growth of 7.5% and organic growth of 7.1%, particularly in emerging markets [13] - The strategy of high-quality prescription drugs combined with local manufacturing is enhancing brand recognition [13] Regional and Profit Performance - International market revenue was $7.070 billion, accounting for over 60% of total sales, with a growth of 9.9% [17] - The U.S. market grew by 2.3%, reflecting a recovery in routine business post-pandemic [17] - The adjusted operating margin improved to 23.0%, with R&D expenses increasing by 7.5%, indicating continued investment in core innovation projects [17] Future Outlook - Management believes that the sustained growth in the medical device sector, steady recovery in diagnostics, and stable performance in nutrition and generics will support achieving the expected full-year performance [18] - Key variables for medium to long-term performance include the expansion of structural heart indications and the penetration rate of CGM products [22]

Core Insights - Abbott Laboratories (ABT) reported third-quarter 2025 adjusted earnings per share (EPS) of $1.30, matching the Zacks Consensus Estimate and reflecting a 7.4% increase from the prior year [1][8] - Total revenues for the quarter were $11.37 billion, up 6.9% year over year, but slightly missing the Zacks Consensus Estimate by 0.24% [2][8] Revenue Breakdown - Established Pharmaceuticals segment sales increased by 7.5% to $1.51 billion, with organic sales in emerging markets growing by 11.1% [3] - Medical Devices segment sales rose 14.8% to $5.45 billion, driven by strong growth in Diabetes Care and other areas [4] - Nutrition sales grew by 4.2% to $2.15 billion, with Adult Nutrition benefiting from strong global brand performance [5][6] - Diagnostics sales declined by 6.6% to $2.25 billion, with organic sales ex-COVID rising by 0.4% [6] Margin and Expense Analysis - Gross profit increased by 6% to $6.29 billion, but gross margin contracted by 46 basis points to 55.4% [9] - Selling, general and administrative expenses rose by 5.4% to $3.05 billion, while research and development expenses increased by 7.4% to $766 million [10] Financial Guidance - For the full year, Abbott expects adjusted diluted EPS in the range of $5.12 to $5.18, reaffirming previous guidance [11] - Full-year organic sales growth, excluding COVID-19 testing-related sales, is projected to be between 7.5% and 8.0% [12] Market Position and Developments - Abbott's third-quarter performance was mixed, with earnings exceeding estimates while revenues fell short [13] - Notable developments include regulatory approval in Japan for TriClip and CE Mark for the Navitor TAVI system [14]