Abbott Laboratories (ABT) Weak In Early Morning Trading

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Abbott Laboratories ( ABT) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Abbott Laboratories as such a stock due to the following factors:

  • ABT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $187.2 million.
  • ABT traded 10,595 shares today in the pre-market hours as of 8:19 AM.
  • ABT is down 3.5% today from Friday's close.

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More details on ABT:

Abbott Laboratories manufactures and sells health care products worldwide. The stock currently has a dividend yield of 2%. ABT has a PE ratio of 31.7. Currently there are 10 analysts that rate Abbott Laboratories a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Abbott Laboratories has been 4.7 million shares per day over the past 30 days. Abbott has a market cap of $65.7 billion and is part of the health care sector and health services industry. The stock has a beta of 0.82 and a short float of 0.7% with 2.75 days to cover. Shares are up 13.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Abbott Laboratories as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.8%. Since the same quarter one year prior, revenues slightly increased by 1.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • The current debt-to-equity ratio, 0.31, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.13, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has increased to $900.00 million or 25.60% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -20.03%.
  • ABBOTT LABORATORIES reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ABBOTT LABORATORIES increased its bottom line by earning $1.50 versus $0.36 in the prior year. This year, the market expects an improvement in earnings ($2.26 versus $1.50).
  • The gross profit margin for ABBOTT LABORATORIES is rather high; currently it is at 59.16%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 8.39% trails the industry average.

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