ABT – Markets are pricing in expectations for Uniform ROA to reach new peaks, and management is confident about their margins, heart failure business, and COVID business
November 17, 2021
- Abbott Laboratories (ABT) currently trades above historical and near corporate averages relative to Uniform earnings, with a 26.5x Uniform P/E (Fwd. V/E’).
- At these levels, markets are pricing in expectations for Uniform ROA to reach new peaks, accompanied by 5% Uniform asset growth.
- Meanwhile, analysts expect Uniform ROA to improve to 31% in 2022, accompanied by 6% Uniform asset growth.
- If sustained going forward, these levels would imply a stock price closer to $108, representing approximately 16% equity downside for the firm.
- However, the firm’s most recent earnings call suggests management is confident about their margins, heart failure business, and COVID business.