Abbott Laboratories

Source: http://www.zacks.com/commentary/8365/Abbott+Laboratories
Posted on Wednesday, August 20th, 2008 | In Stocks to Watch

Contributed by: Alex Kolb (http://www.zacks.com/) -

Abbott Laboratories (ABT), which is trading near a 52-week high, announced stellar results for the second quarter and boosted its full-year 2008 guidance in mid-July. Wall Street earnings forecasts have moved higher since. Full-year 2008 estimates of $3.27 per share advanced from $3.23 over the past 60 trading days. Year 2009 projections of $3.65 climbed from $3.60 over the same time frame.

Company Description

Abbott is a global, broad-based health care company that develops, manufactures and markets pharmaceuticals and medical products, including nutritionals, devices and diagnostics. The company employs more than 68,000 people and markets its products in more than 130 countries. The company is headquartered in north suburban Chicago.

Healthy Growth

In mid-July, the company posted stellar results for the second quarter and boosted its full-year 2008 guidance. Earnings per share of 84 cents outpaced the year-prior 69 cents and beat the consensus estimate by 8%.

“Abbott achieved another quarter of strong performance across our diverse mix of global businesses, with particularly strong results internationally,” said Miles D. White, chairman and chief executive officer, Abbott. “Based on our first-half results, as well as our outlook for the remainder of the year, we’re raising our 2008 forecast for both sales growth and earnings-per-share. We’re also confirming our expectation for continued double-digit earnings-per-share growth in 2009.”

The company hiked its earnings-per-share guidance range for the 2008 full-year from $3.20 – $3.25 to $3.24 – $3.28, excluding specified items.

Full-year 2008 Wall Street estimates of $3.27 per share advanced from $3.23 over the past 60 trading days. Year 2009 projections of $3.65 climbed from $3.60 over the same time frame.

Abbott Laboratories offers a solid return on equity (ROE) of 27%, which tops the industry average of -13%.

Continued Income

In early June, the company declared a quarterly dividend of 36 cents per share, noting that this was the 338th consecutive quarterly dividend paid out by Abbott since 1924. The dividend was paid out on August 15, 2008.

The dividend translates into a yield of 2.4%, which stands high above the yields offered by its peers as most companies within ABTÂ’s industry group offer no dividend.

“ABT” Free Stock Analysis: Buy? Sell? Hold?
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