Gordon Reid Abbott Labs ABT-N COMMENT May 05, 2015

They reported solid numbers today and considered raising their full-year forecast but then the tariffs hit, but maintained guidance, which is positive enough in this market. Shares jumped 2.76% today. A weaker USD helps too.

Their forward PE suggests an explosion, coming from their diabetes device, Libra. A fine CEO who will settle their lawsuits. Is up 17% this year.

In general, he's had almost no healthcare exposure for the last year. Relative price performance for the group has been weak. That said, he's seeing some improvement around the edges. 

He always looks for what's held up better than the rest, and this name would fit. Performed better than 78% of S&P stocks over the last 52 weeks. Technically, made a series of higher lows. More of its earnings estimates have moved higher than lower, so earnings momentum revision is decent. Hasn't technically broken out, so he's not there yet. If you own it, hold.

Is defensive and not a target like the pharmas. Abbott is in testing and diagnostics, a steady business reflected in their numbers.

It reports Thursday. Wait for the report first. They are always misinterpreted during earnings which annoys him. He likes ABT.

He always starts with what universe are we operating in and how's it performing? Likes the market, but healthcare (pharma, biotech, healthcare providers, devices) has been about the weakest RSI sector. Was performing better than the group, but today narrowed guidance. Technically broken. Wait for healthcare technicals to improve.

Diversified. Over 60% of sales come from outside US, so a more globally balanced name in the sector. 10/10 on fundamentals. Medical devices division has had 10 straight quarters of 10+% growth with momentum in epilepsy, diabetes, and heart failure. Focusing on growing its core lab-testing platform and expanding diagnostic footprint in non-Covid areas. 

Steady margins, no change to full-year earnings guidance. Trades at a premium, but stronger ROI forecast. Sees upside potential of ~14% from here. Yield is 1.91%.

A diversified medical equipment company, including portable diagnostics, critical care in ambulances, and remote care. They made big acquisitions a few years ago. Is a safe way to play the health space recovery. Pharma is established and nutrition (Ensure) which are slower-growth, but provide stability and cash flow.

Pharma is in the penalty box, but medical devices are not (so far). Organic growth in the core business is nearly 10%, strong. They enjoy massive demographic support. The PE is around a low 20x PE. Has strong growth. Wait for a pullback to enter.

Very stable and pays a nice, reliable dividend (rising over the last 60 years). Many buy this for the safe dividend. Expect modest capital appreciation. Safe.