NEW YORK (TheStreet) -- Given that shares of Abbott Labs (ABT) are up by more than 10% since the company released its third-quarter earnings report Oct. 16, readers are gleefully reminding me that I didn't give the company much love ahead of the announcement.
It's true that Abbott's lack of revenue growth didn't give me that "warm and fuzzy" feeling about its competitive position against the likes of Roche (RHHBY) and Johnson & Johnson (JNJ). But it was far from a teardown piece. If I may quote myself:
"I believe the only way to justify buying this stock -- even on this recent pullback -- is for management to demonstrate not only better operating balance between the company's four remaining business segments, but Abbott has to show that it can compete more effectively against Johnson & Johnson in areas like medical devices."
"Likewise, I believe Abbott can stabilize its stock and inject some confidence if management shores up the company's performance in its Established Pharmaceuticals business, or what the company calls 'branded generics.' If that that segment can show better than 2% growth, it would be an encouraging sign."
"I do see opportunities for Abbott to steal market share in devices and diagnostics. But it may require a strategic acquisition, or possibly two, for Abbott to gain the sort of leverage it needs to execute its global ambitions. While this recent pullback does make the stock appear more attractive, absent better growth and diversification, I'm still not at the point where I want to risk my own money here."