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On Thursday, TD Cowen reaffirmed confidence in Abbott Laboratories (NYSE:ABT), with analyst Joshua Jennings increasing the price target to $145 from $135 and retaining a Buy rating on the stock. The adjustment reflects a positive outlook following Abbott’s first quarter performance and its reiteration of the 2025 financial guidance. According to InvestingPro data, Abbott’s stock is trading near its 52-week high of $141.23, with a strong year-to-date return of 15.8%.
Abbott reported first-quarter earnings that showcased resilience amidst challenging market conditions. The company’s revenue reached $10.36 billion, with earnings per share (EPS) of $1.09, narrowly missing revenue estimates of $10.41 billion but exceeding EPS forecasts of $1.07. These results signify a 6.9% year-over-year organic sales increase and an 8.3% rise when excluding Covid test sales. InvestingPro analysis reveals Abbott maintains a GREAT financial health score of 3.08, with particularly strong marks in profitability and price momentum.
The Medical (TASE:BLWV) Devices segment was particularly strong, achieving 12.6% organic growth with sales amounting to $4.90 billion, slightly above the anticipated $4.86 billion. Diabetes Care also saw remarkable growth, with Continuous Glucose Monitoring (CGM) sales hitting $1.7 billion, marking a 21.6% organic sales increase, including a 30% surge in the U.S. market.
Despite a robust overall performance, the Diagnostics division did not meet expectations, generating $2.05 billion in revenue against a consensus estimate of $2.19 billion. This shortfall was largely due to the Volume-Based Procurement (VBP) policy in China. Nevertheless, excluding China, the Core Laboratory segment grew by 6.5%, indicating that the challenges are confined to the Chinese market. Abbott anticipates moving past these difficulties in the second half of the year.
Abbott’s ability to uphold its 2025 guidance in the face of a "few hundred million dollars" tariff impact underscores the firm’s operational strength. The company continues to project an EPS between $5.05 and $5.25, operating margins of 23.5% to 24.0%, and organic sales growth of 7.5% to 8.5%. This steadfast outlook, combined with solid first-quarter achievements, serves to alleviate investor concerns regarding the current macroeconomic environment. The company has demonstrated its commitment to shareholder returns, maintaining dividend payments for 55 consecutive years with a current yield of 1.82%. For deeper insights into Abbott’s valuation and growth prospects, investors can access comprehensive analysis through InvestingPro’s detailed research reports, which cover over 1,400 top US stocks.
In other recent news, Abbott Laboratories reported its first-quarter financial results, showcasing a year-over-year organic sales growth of 6.9%, with a notable 12.6% increase in its Medical Devices segment. The company’s earnings per share (EPS) exceeded several analysts’ expectations, with Stifel noting an EPS of $1.09, surpassing their estimate of $1.07. Despite challenges like lower-than-expected COVID-19 testing sales, Abbott reaffirmed its full-year 2025 guidance, projecting organic revenue growth between 7.5% and 8.5% and adjusted EPS in the range of $5.05 to $5.25. Analysts from RBC Capital, UBS, Piper Sandler, and Oppenheimer have shown confidence in Abbott, with RBC and Piper Sandler raising their price targets to $145, while UBS set theirs at $148. Oppenheimer increased their target to $140, maintaining an Outperform rating. Conversely, Stifel adjusted their price target downward to $135 but maintained a Buy rating. The analysts highlighted Abbott’s strategic initiatives to mitigate tariff impacts and its strong performance in the MedTech sector. These developments reflect a positive outlook for Abbott Laboratories, as the company continues to navigate macroeconomic challenges and focus on growth opportunities.
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