Abbott Laboratories: Hold Rating Amid Mixed Performance and Sector Challenges

Analyst Mike Kratky from Leerink Partners reiterated a Hold rating on Abbott Laboratories and decreased the price target to $136.00 from $143.00.

Mike Kratky has given his Hold rating due to a combination of factors impacting Abbott Laboratories’ performance. The company’s recent 2Q earnings report presented a mixed picture, with management lowering their organic sales growth guidance. This adjustment was influenced by several headwinds, such as weaker-than-expected COVID-19 sales, disruptions from value-based purchasing (VBP) in China, and changes in HIV funding, which collectively dampened the outlook for the Diagnostics segment.
Despite these challenges, there are positive aspects, particularly within Abbott’s MedTech segment, which showed robust growth, especially in the Diabetes and Electrophysiology (EP) areas. However, the non-MedTech segments, which contribute significantly to the company’s revenue, continue to face disruptions. As a result, while there is potential for outperformance in certain areas, the overall outlook remains cautious, justifying the Hold rating.

In another report released on July 18, Mizuho Securities also maintained a Hold rating on the stock with a $135.00 price target.