Rothschild Redburn Upgrades Abbott Labs (ABT) to Buy

Rothschild Redburn analyst Ed Ridley-Day upgraded Abbott Labs (NYSE: ABT) from Neutral to Buy with a price target of $127.00 (from $119.00).

The analyst comments: “We have long held that Abbott Laboratories’ Medical Devices business can sustain robust growth supported by strong fundamentals and opportunities in cardiovascular and diabetes. Our cautious view has been predicated on the growth challenges we see in the in vitro diagnostic (IVD) and nutrition markets. The acquisition of Exact Sciences has strengthened Diagnostics’ growth and margin profile, and we see sustained momentum in Cardiovascular. We raise our PT to $127 (from $119). We would see further upside if management addressed its conglomerate structure and exited businesses, such as Nutrition, that dilute growth and returns.

In Diagnostics, Abbott Laboratories is sensitive to competitive and low-growth market segments. The acquisition of Exact Sciences, the leader in colorectal cancer screening, has enhanced Diagnostic and group growth, and we expect Cologuard to remain standard of care in colorectal cancer (CRC) screening despite increasing competition. We provide a detailed assessment of Exact’s technology, pipeline and the opportunity for Abbott in the cancer screening market.

Abbott continues to benefit from strong growth in its core Medical Devices division (+10.6% FY26E organic). The Medical Devices business is the jewel in Abbott’s crown, and its potential leaves the company well placed to achieve its 6.5-8.5% mid-term growth guidance. We expect growth acceleration and share gains in Electrophysiology (EP), led by the US uptake of Abbott’s Volt pulsed field ablation (PFA) and TactiFlex Duo catheters and the company’s leadership in Diabetes technology (+11.7% FY26E).”

For an analyst ratings summary and ratings history on Abbott Labs click here. For more ratings news on Abbott Labs click here.

Shares of Abbott Labs closed at $96.69 yesterday.

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