Reasons why Abbott (ABT) should be in your portfolio
Updated: Dec 16, 2022
Abbott labs, the healthcare and medical devices conglomerate, reported $3.3 billion in coronavirus test sales last quarter. But as the pandemic cases are coming down, are Abbott shares still worth investing in?
Dive in to understand how it is still a trusted brand with numerous revenue-generating avenues to continue its growth trajectory!
Background
Abbott Laboratories (NYSE: ABT) is a multinational pharma company known for its vast range of healthcare products. The company operates under four major arms:
Established Pharmaceutical Products
Diagnostic Products
Nutritional Products
Vascular Products
Additionally, the company offers products like structural heart products, electrophysiology products, and more!
Attractive investment
With such a wide portfolio of products and services, the company is one of the largest and oldest healthcare companies and hence a favorite in the stock market.
It has gained a positive Growth Score and topped the Zacks Rank. The combination of favorability of a Growth Score of A or B and a Zacks Rank (#1 is a strong buy and #2 is a buy) has made it a must-have stock on every investor's list!
Stable growth
Abbott Labs has a $238 billion market cap and about $42.3 billion in revenue.
The dividend yield of the stocks has remained stable throughout the last fifty years. It signifies the resilient nature of the stock, attracting investors to enjoy a steady return.
Competing businesses offer a single category service, whereas Abbott has scaled up to a range of products. Its high-end expertise in surgical instruments and monitoring tools makes it stand out in one too many categories.
The foundation of the company with its wide base is its biggest asset. The patent value and favorable reputation in the industry gain a competitive advantage over other companies in the market.
Booming healthcare sector
After the world was hit by the pandemic, the stock market went through a major cycle of ups and downs!
Asa medical devices company, Abbott Labs touched $1.9 billion in the third quarter of 2021. With Covid-19 diagnostic tests and rapid antigen kits, the diagnostic sales of the company rose by 45% during the third quarter of 2021.
The news of test kits being out of stock was a strong sign of its rapid growth in the market. The company experienced a whopping sale of more than 225 million Covid-19 test kits. Since the beginning of the pandemic, the company has sold out more than 1 billion kits!
Even if Covid-19 test revenue is dropping, investors can stay optimistic about this stock because the company saw organic growth of 12% along with its other segments. There was significant growth in consumer-oriented products like nutrition, diabetic care, and established pharmaceuticals.
In 2021, its cardiology medical device segments generated $9 billion+ in revenue. And Abbott continues to innovate and launch new products in the market to sustain its incredible growth.
Must-buy stock
In the fast-paced market, ABT is a well-balanced stock. Its steady growth and competitive advantage make it a safe harbor for the investor, even in times of a volatile economy.
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References:
https://www.stash.com/investments/stocks/abbott-laboratories-abt/
https://finance.yahoo.com/news/3-reasons-why-abbott-abt-174505096.html
https://www.nasdaq.com/articles/heres-why-you-should-invest-in-abbott-abt-stock-right-now