ABBOTT LABORATORIES (ABT) Stock Fundamental Analysis
NYSE:ABT - New York Stock Exchange, Inc. - US0028241000 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to ABT. ABT was compared to 187 industry peers in the Health Care Equipment & Supplies industry. Both the health and profitability get an excellent rating, making ABT a very profitable company, without any liquidiy or solvency issues. ABT is not valued too expensively and it also shows a decent growth rate. These ratings could make ABT a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
In the past year ABT was profitable.
ABT had a positive operating cash flow in the past year.
In the past 5 years ABT has always been profitable.
Each year in the past 5 years ABT had a positive operating cash flow.
1.2 Ratios
ABT has a Return On Assets of 16.58%. This is amongst the best in the industry. ABT outperforms 96.79% of its industry peers.
Looking at the Return On Equity, with a value of 27.66%, ABT belongs to the top of the industry, outperforming 96.79% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 9.27%, ABT belongs to the top of the industry, outperforming 90.37% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ABT is above the industry average of 7.89%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.58% | ||
| ROE | 27.66% | ||
| ROIC | 9.27% |
ROA(3y)11.2%
ROA(5y)9.84%
ROE(3y)20.61%
ROE(5y)19.06%
ROIC(3y)10.45%
ROIC(5y)10.18%
1.3 Margins
ABT has a better Profit Margin (31.89%) than 97.33% of its industry peers.
ABT's Profit Margin has improved in the last couple of years.
ABT has a Operating Margin of 17.45%. This is amongst the best in the industry. ABT outperforms 88.77% of its industry peers.
ABT's Operating Margin has improved in the last couple of years.
ABT has a Gross Margin of 56.10%. This is comparable to the rest of the industry: ABT outperforms 54.01% of its industry peers.
In the last couple of years the Gross Margin of ABT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.45% | ||
| PM (TTM) | 31.89% | ||
| GM | 56.1% |
OM growth 3Y-5.79%
OM growth 5Y2.63%
PM growth 3Y24.85%
PM growth 5Y22.55%
GM growth 3Y-0.89%
GM growth 5Y-1.07%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), ABT is creating some value.
Compared to 1 year ago, ABT has about the same amount of shares outstanding.
ABT has less shares outstanding than it did 5 years ago.
The debt/assets ratio for ABT has been reduced compared to a year ago.
2.2 Solvency
ABT has an Altman-Z score of 6.01. This indicates that ABT is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 6.01, ABT belongs to the best of the industry, outperforming 80.75% of the companies in the same industry.
ABT has a debt to FCF ratio of 1.99. This is a very positive value and a sign of high solvency as it would only need 1.99 years to pay back of all of its debts.
ABT's Debt to FCF ratio of 1.99 is amongst the best of the industry. ABT outperforms 89.84% of its industry peers.
ABT has a Debt/Equity ratio of 0.26. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of ABT (0.26) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.26 | ||
| Debt/FCF | 1.99 | ||
| Altman-Z | 6.01 |
ROIC/WACC1.06
WACC8.75%
2.3 Liquidity
ABT has a Current Ratio of 1.78. This is a normal value and indicates that ABT is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.78, ABT is not doing good in the industry: 70.05% of the companies in the same industry are doing better.
A Quick Ratio of 1.27 indicates that ABT should not have too much problems paying its short term obligations.
The Quick ratio of ABT (1.27) is worse than 68.98% of its industry peers.
The current and quick ratio evaluation for ABT is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.78 | ||
| Quick Ratio | 1.27 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.88% over the past year.
Measured over the past 5 years, ABT shows a small growth in Earnings Per Share. The EPS has been growing by 7.59% on average per year.
The Revenue has been growing slightly by 5.00% in the past year.
Measured over the past years, ABT shows a small growth in Revenue. The Revenue has been growing by 5.63% on average per year.
EPS 1Y (TTM)8.88%
EPS 3Y-3.58%
EPS 5Y7.59%
EPS Q2Q%11.22%
Revenue 1Y (TTM)5%
Revenue growth 3Y-0.88%
Revenue growth 5Y5.63%
Sales Q2Q%3.95%
3.2 Future
Based on estimates for the next years, ABT will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.82% on average per year.
Based on estimates for the next years, ABT will show a small growth in Revenue. The Revenue will grow by 7.19% on average per year.
EPS Next Y11.61%
EPS Next 2Y10.91%
EPS Next 3Y10.72%
EPS Next 5Y9.82%
Revenue Next Year6.43%
Revenue Next 2Y7.08%
Revenue Next 3Y7.24%
Revenue Next 5Y7.19%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 27.51, the valuation of ABT can be described as expensive.
Based on the Price/Earnings ratio, ABT is valued a bit cheaper than the industry average as 77.54% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of ABT to the average of the S&P500 Index (27.19), we can say ABT is valued inline with the index average.
ABT is valuated rather expensively with a Price/Forward Earnings ratio of 22.89.
Based on the Price/Forward Earnings ratio, ABT is valued a bit cheaper than the industry average as 76.47% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.33, ABT is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.51 | ||
| Fwd PE | 22.89 |
4.2 Price Multiples
73.26% of the companies in the same industry are more expensive than ABT, based on the Enterprise Value to EBITDA ratio.
ABT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ABT is cheaper than 80.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.37 | ||
| EV/EBITDA | 22.33 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of ABT may justify a higher PE ratio.
PEG (NY)2.37
PEG (5Y)3.63
EPS Next 2Y10.91%
EPS Next 3Y10.72%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.77%, ABT has a reasonable but not impressive dividend return.
ABT's Dividend Yield is rather good when compared to the industry average which is at 1.75. ABT pays more dividend than 96.26% of the companies in the same industry.
ABT's Dividend Yield is slightly below the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.77% |
5.2 History
The dividend of ABT is nicely growing with an annual growth rate of 11.40%!
ABT has been paying a dividend for at least 10 years, so it has a reliable track record.
ABT has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.4%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
28.92% of the earnings are spent on dividend by ABT. This is a low number and sustainable payout ratio.
The dividend of ABT is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP28.92%
EPS Next 2Y10.91%
EPS Next 3Y10.72%
131.49
-0.54 (-0.41%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners80.44%
Inst Owner Change0%
Ins Owners0.45%
Ins Owner Change0.71%
Market Cap228.77B
Analysts78.18
Price Target144.51 (9.9%)
Short Float %1.12%
Short Ratio3.21
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.77% |
Yearly Dividend2.21
Dividend Growth(5Y)11.4%
DP28.92%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.21%
Min EPS beat(2)-1.16%
Max EPS beat(2)0.73%
EPS beat(4)2
Avg EPS beat(4)0.36%
Min EPS beat(4)-1.16%
Max EPS beat(4)2.22%
EPS beat(8)5
Avg EPS beat(8)0.86%
EPS beat(12)9
Avg EPS beat(12)5.62%
EPS beat(16)13
Avg EPS beat(16)9.57%
Revenue beat(2)0
Avg Revenue beat(2)-1.35%
Min Revenue beat(2)-1.37%
Max Revenue beat(2)-1.33%
Revenue beat(4)0
Avg Revenue beat(4)-0.95%
Min Revenue beat(4)-1.37%
Max Revenue beat(4)-0.19%
Revenue beat(8)2
Avg Revenue beat(8)-0.01%
Revenue beat(12)6
Avg Revenue beat(12)1.49%
Revenue beat(16)10
Avg Revenue beat(16)3.05%
PT rev (1m)0.23%
PT rev (3m)3.11%
EPS NQ rev (1m)0.15%
EPS NQ rev (3m)0.18%
EPS NY rev (1m)0.05%
EPS NY rev (3m)0.22%
Revenue NQ rev (1m)0.1%
Revenue NQ rev (3m)0.82%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.74%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.51 | ||
| Fwd PE | 22.89 | ||
| P/S | 5.4 | ||
| P/FCF | 34.37 | ||
| P/OCF | 25.56 | ||
| P/B | 4.69 | ||
| P/tB | 11.92 | ||
| EV/EBITDA | 22.33 |
EPS(TTM)4.78
EY3.64%
EPS(NY)5.74
Fwd EY4.37%
FCF(TTM)3.83
FCFY2.91%
OCF(TTM)5.14
OCFY3.91%
SpS24.34
BVpS28.05
TBVpS11.03
PEG (NY)2.37
PEG (5Y)3.63
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.58% | ||
| ROE | 27.66% | ||
| ROCE | 10.8% | ||
| ROIC | 9.27% | ||
| ROICexc | 10.3% | ||
| ROICexgc | 19.85% | ||
| OM | 17.45% | ||
| PM (TTM) | 31.89% | ||
| GM | 56.1% | ||
| FCFM | 15.72% |
ROA(3y)11.2%
ROA(5y)9.84%
ROE(3y)20.61%
ROE(5y)19.06%
ROIC(3y)10.45%
ROIC(5y)10.18%
ROICexc(3y)12.18%
ROICexc(5y)11.89%
ROICexgc(3y)32.65%
ROICexgc(5y)35.03%
ROCE(3y)12.16%
ROCE(5y)11.86%
ROICexcg growth 3Y-24.08%
ROICexcg growth 5Y-8.19%
ROICexc growth 3Y-10.71%
ROICexc growth 5Y6.04%
OM growth 3Y-5.79%
OM growth 5Y2.63%
PM growth 3Y24.85%
PM growth 5Y22.55%
GM growth 3Y-0.89%
GM growth 5Y-1.07%
F-Score7
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.26 | ||
| Debt/FCF | 1.99 | ||
| Debt/EBITDA | 1.21 | ||
| Cap/Depr | 72.36% | ||
| Cap/Sales | 5.42% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 84.75% | ||
| Profit Quality | 49.3% | ||
| Current Ratio | 1.78 | ||
| Quick Ratio | 1.27 | ||
| Altman-Z | 6.01 |
F-Score7
WACC8.75%
ROIC/WACC1.06
Cap/Depr(3y)63.63%
Cap/Depr(5y)61.92%
Cap/Sales(3y)4.94%
Cap/Sales(5y)5.1%
Profit Quality(3y)82.78%
Profit Quality(5y)99.6%
High Growth Momentum
Growth
EPS 1Y (TTM)8.88%
EPS 3Y-3.58%
EPS 5Y7.59%
EPS Q2Q%11.22%
EPS Next Y11.61%
EPS Next 2Y10.91%
EPS Next 3Y10.72%
EPS Next 5Y9.82%
Revenue 1Y (TTM)5%
Revenue growth 3Y-0.88%
Revenue growth 5Y5.63%
Sales Q2Q%3.95%
Revenue Next Year6.43%
Revenue Next 2Y7.08%
Revenue Next 3Y7.24%
Revenue Next 5Y7.19%
EBIT growth 1Y12%
EBIT growth 3Y-6.62%
EBIT growth 5Y8.41%
EBIT Next Year29.19%
EBIT Next 3Y15.9%
EBIT Next 5Y10.98%
FCF growth 1Y-2.43%
FCF growth 3Y-9.78%
FCF growth 5Y7.14%
OCF growth 1Y3.36%
OCF growth 3Y-6.69%
OCF growth 5Y6.88%