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Abbott (ABT) Stock Sinks As Market Gains: Here's Why

Abbott (ABT) closed at $103.95 in the latest trading session, marking a -0.27% move from the prior day. The stock trailed the S&P 500, which registered a daily gain of 0.7%. At the same time, the Dow added 0.01%, and the tech-heavy Nasdaq gained 1.1%.

Shares of the maker of infant formula, medical devices and drugs witnessed a loss of 2.46% over the previous month, trailing the performance of the Medical sector with its gain of 3.27% and the S&P 500's gain of 4.03%.

Analysts and investors alike will be keeping a close eye on the performance of Abbott in its upcoming earnings disclosure. The company is expected to report EPS of $1.10, up 1.85% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $10.35 billion, indicating a 3.78% increase compared to the same quarter of the previous year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $4.62 per share and revenue of $41.66 billion, indicating changes of +4.05% and +3.86%, respectively, compared to the previous year.

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Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Abbott. Such recent modifications usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. Abbott is currently a Zacks Rank #3 (Hold).

In terms of valuation, Abbott is currently trading at a Forward P/E ratio of 22.57. This denotes a discount relative to the industry's average Forward P/E of 22.78.

Investors should also note that ABT has a PEG ratio of 2.51 right now. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Medical - Products industry currently had an average PEG ratio of 2.17 as of yesterday's close.

The Medical - Products industry is part of the Medical sector. This industry, currently bearing a Zacks Industry Rank of 95, finds itself in the top 38% echelons of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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Abbott Laboratories (ABT) : Free Stock Analysis Report

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