Abbott Labs stock gains as UBS reiterates Buy rating on Exact Sciences deal

Investing.com - Abbott Labs (NYSE:ABT) stock gained after UBS reiterated a Buy rating and $158.00 price target following the company’s agreement to acquire Exact Sciences (NASDAQ:EXAS). The healthcare giant, currently valued at over $215 billion, has received a "GREAT" overall financial health score from InvestingPro, with analysts maintaining a strong "Buy" consensus recommendation.

Abbott announced a definitive agreement to acquire Exact Sciences at $105 per share, with the transaction expected to close in the second quarter of 2026. The acquisition is projected to add approximately 300 basis points to Abbott’s Diagnostics segment growth. This strategic move builds on Abbott’s existing revenue growth of 6.4% over the last twelve months, with the company generating nearly $44 billion in revenue during this period.

UBS noted that even before this transaction, the firm expected Abbott’s Diagnostics year-over-year comparisons to begin normalizing in 2026 as the China business becomes less significant. UBS models approximately 6% year-over-year Diagnostics growth in 2026, compared to the Street consensus of about 4%.

Abbott expects to achieve approximately $100 million in pre-tax cost synergies from the acquisition. UBS views this estimate as likely conservative, noting potential opportunities to optimize the primary care physician salesforce across both organizations and significantly reduce Exact Sciences’ general and administrative expenses, which UBS estimates will be approximately $790 million in 2026.

Beyond Diagnostics, UBS maintains high conviction that Abbott’s sustainable double-digit growth medical technology profile positions the company for consistent sales and earnings per share outperformance from 2026 onward.

In other recent news, Abbott Laboratories is reportedly in discussions to acquire Exact Sciences, a cancer screening company. This potential acquisition aims to expand Abbott’s diagnostics business, which currently accounts for about 20% of its total revenue. Additionally, Abbott’s third-quarter 2025 earnings report has drawn attention, with UBS raising its price target for the company from $154 to $158 while maintaining a Buy rating. UBS emphasized the sustainability of Abbott’s double-digit growth in its MedTech segment as a key highlight. Benchmark also reiterated its Buy rating, citing strong performance in Abbott’s Medical Devices portfolio, particularly in areas like Diabetes Care and Electrophysiology. Despite some mixed results, RBC Capital maintained an Outperform rating, noting that the company’s earnings per share met expectations. Abbott’s stock has been viewed positively by analysts, with potential upside to 2026 estimates highlighted by UBS. These developments reflect ongoing interest and confidence in Abbott’s growth prospects.

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