Shares of healthcare provider Abbott Laboratories (NYSE: ABT) closed 2.6% down on Wednesday, even after the company reported higher-than-expected results for the fourth quarter of 2021. The stock gained 0.3% in the extended trading session.
Illinois-based Abbott sells medical devices, diagnostics, branded generic medicines, and nutritional products.
Adjusted earnings declined 9% year-over-year to $1.32 per share but surpassed the Street’s estimate of $1.21.
Net sales grew 7.2% year-over-year to $11.47 billion and exceeded analysts’ expectations of $10.71 billion.
The Nutrition segment’s sales increased 5.5% to $2 billion; sales of the Diagnostics segment rose 2.9% to $4.5 billion; the Established Pharmaceuticals segment’s sales jumped 4.9% to $1.2 billion; sales of the Medical Devices segment surged 15.1% to $3.7 billion.
Abbott’s Chairman and CEO Robert B. Ford said, “2021 was an outstanding year for Abbott. We achieved more than 40% EPS growth, exceeding the baseline EPS guidance we set at the beginning of last year and, importantly, continued to advance our new product pipeline across the portfolio.”
Guidance
Along with the fourth-quarter results, the company provided guidance for the first quarter and full-year 2022.
It expects adjusted EPS to be at least $1.50 in the first quarter, compared to the consensus estimate of $1.13.
For 2022, Abbott projects adjusted EPS to come in at $4.70 versus analyst expectations of $4.78.
Wall Street’s Take
After the results were announced, BTIG analyst Marie Thibault reiterated a Buy rating on the stock with a price target of $138 (15% upside potential).
The analyst said, “We think there is plenty of caution built into the outlook for both EPS and COVID test sales; we view both metrics as a baseline and expect ABT to beat and raise.”
Overall, the stock has a Strong Buy consensus rating based on 7 Buys and 1 Hold. The average Abbott Laboratories stock prediction of $147.38 implies 22.8% upside potential. Shares have lost 13.3% year-to-date.
Smart Score
Abbott scores a “Perfect 10” on TipRanks’ Smart Score rating system, which makes it one of the top healthcare stocks to buy. The stock has strong potential to outperform market expectations.
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