Based on the aggregated intelligence of 115,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, health-care company Abbott Labs (NYSE: ABT ) has earned a respected four-star ranking. Although five-star stocks have been the best performers, our data has shown that four-star stocks still outshine the market by a significant margin and shouldn't be taken lightly; conversely, low-rated stocks have woefully lagged the market average.
With that in mind, let's take a closer look at Abbott's business and see what CAPS investors are saying about the stock right now.
Abbott facts
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Headquarters (Founded)
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Abbott Park, Ill. (1888)
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Market Cap
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$76.23 Billion
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Industry
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Pharmaceuticals
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Trailing-12-Month Revenue
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$27.68 Billion
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Management
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CEO Miles White (Since 1999)
CFO Thomas Freyman (Since 2001)
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Return on Equity (Average, Past Three Years)
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19.4%
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Competitors
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Baxter International (NYSE: BAX )
Merck (NYSE: MRK )
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CAPS Members Bullish on ABT Also Bullish on:
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Johnson & Johnson (NYSE: JNJ )
Procter & Gamble (NYSE: PG )
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CAPS Members Bearish on ABT Also Bearish on:
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Pfizer (NYSE: PFE )
Bristol-Myers Squibb (NYSE: BMY )
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
Over on CAPS, 258 of 270 of the All-Star members who have rated Abbott -- some 96% -- believe the stock will outperform the S&P 500 going forward. These bulls include JUT8407 and InvestRx, both of whom are ranked in the top 10% of our community.
In July, JUT8407 noted of Abbott: "a very good pipeline and also has many products available today producing great revenues for the company. With an aging population, a drug for just about anything, this will be a good/safe bet."
A more recent pitch from marc64 last week shares that bullish attitude and updates our community on the company's current estimates:
The company increased its earnings-per-share guidance from a range of $3.20 - $3.25 to $3.24 - $3.28, excluding specified items, reflecting growth of about 15% along with expected sales growth in the mid-teens for the full year. Abbott Labs is trading at less than 18X its 2008 earnings guidance with a 2.6% dividend yield, resulting in a price-earnings to growth ratio of just 1.2X. Given a healthy mix of business units and geographical diversification, Abbott Labs is poised to break through all-time highs over the $60 level, which was reached earlier this year.
What do you think about Abbott, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 115,000 investors are waiting to hear what you have to say. CAPS is 100% free, so get started.
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