Abbott Labs (ABT)

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.

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%.

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.

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

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

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.

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.

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.

It reports Wednesday. They will report on their strong franchises and their baby formula lawsuit which would have hurt their valuation for a long time. Not long ago, this was 14 points higher during that brutal, ridiculous rotation. These stocks are now all the way down.

He was looking at defensive healthcare names to avoid threat of tariffs. This is one name to consider, reasonable valuation but good growth profile.

Is enjoying the rotation out of semis/tech stocks today, up 3.52%. It's been undervalued lately. Has more room to run; he expects the rotation to continue beyond today.

It is one of the more diversified lab equipment manufacturers. He really likes the medical part and sees growth there. Some of their components have slower growth.

Is one of the stars of the JPMorgan conference. Shares have been growing in a straight line with growth in medical devices and pharmaceuticals.

Pharma companies are always facing the patent wall, needing to spend R&D to innovate new drugs. Very difficult to predict the next blockbuster. He prefers and owns JNJ and ABT, as they're more diversified.

Has excellent fundamentals across four businesses, including best-in-class medical devices renown in cardiology. However, they face lawsuits over their similac formula which studies show is not harmful. It's unfair. It lost a lawsuit last summer and was hit a $495 million penalty. More lawsuits are coming, though the latest decision yesterday went in Abbott's favour. Last month, federal agencies found that the formula is not at fault. Two weeks ago, ABT reported a clean top and bottom line beat and raised their full-year forecast. Shares would have rallied more without the lawsuits.