Abbott Labs stock price target lowered to $145 at BTIG on China headwinds

Published 17/07/2025, 21:36
Abbott Labs stock price target lowered to $145 at BTIG on China headwinds

Investing.com - BTIG lowered its price target on Abbott Labs (NYSE:ABT) to $145 from $148 while maintaining a Buy rating on Thursday, as the healthcare company faces challenges in its China diagnostics business. According to InvestingPro data, Abbott maintains a GREAT financial health score of 3.15, with strong profit metrics and cash flows that sufficiently cover interest payments.

Abbott shares fell approximately 8% in Thursday trading despite beating second-quarter expectations on both top and bottom lines. The company revised its full-year guidance to the lower end of its previous range due to volume-based procurement issues in China’s Core Lab business and declining COVID test sales. With a P/E ratio of 15.7x and a market capitalization of $210 billion, Abbott remains a prominent player in the Healthcare Equipment & Supplies industry, as highlighted by InvestingPro analysis.

These challenges represent approximately $700 million or 750 basis points headwind to 2025 sales growth in the Diagnostics segment, which increases to over $1 billion when including HIV testing headwinds. BTIG characterized these issues as "a one-time dynamic out of ABT’s control that may be resolved around year-end."

Abbott’s revised 2025 full-year guidance now projects 7.5-8% organic sales growth (down from 7.5-8.5%), adjusted operating margins of 23.5% (down from 23.5-24.0%), and adjusted EPS of $5.10-$5.20 (narrowed from $5.05-$5.25). Management also informally endorsed 2026 analyst estimates, noting that high-single-digit top-line and double-digit bottom-line growth assumptions appear reasonable.

Despite the near-term challenges, BTIG remains bullish on Abbott’s long-term trajectory, citing strong performance in other segments including 8% year-over-year growth in Core Lab Diagnostics excluding China and approximately 12% organic growth in Medical (TASE:BLWV) Devices. The firm reduced its price-to-earnings multiple from 25x to 24.5x, resulting in the slightly lower price target. Abbott’s strong fundamentals are further evidenced by its 55-year history of maintaining dividends and 11 consecutive years of dividend increases. For deeper insights into Abbott’s valuation and growth prospects, including access to comprehensive Pro Research Reports covering 1,400+ top stocks, visit InvestingPro.

In other recent news, Abbott Laboratories reported its second-quarter 2025 earnings, surpassing Wall Street expectations with an earnings per share (EPS) of $1.26, slightly above the consensus forecast of $1.25. Revenue for the quarter reached $11.42 billion, exceeding projections of $11.07 billion, driven by strong sales in its core businesses. Despite these positive results, Abbott Labs reduced its full-year organic revenue growth forecast from 7.5-8.5% to 6.0-7.0%, primarily due to challenges in its Diagnostics segment. Evercore ISI maintained an Outperform rating on Abbott but lowered the stock’s price target to $140 from $145, citing the company’s organizational restructuring and market concerns. Meanwhile, Goldman Sachs kept its Buy rating and $153 price target, noting the guidance cut could lead to market volatility. Abbott’s management remains optimistic, reiterating its double-digit EPS growth forecast for fiscal years 2025 and 2026. These developments reflect Abbott’s efforts to manage revenue headwinds while maintaining its growth trajectory.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.