Stock analysis/Share presentation ⬇️
Today we are talking about the company Abbott Laboratories: $ABT (+1,26%)
What is and does Abbott Laboratories anyway: 🤔
Abbott Laboratories is a company focused on developing healthcare products and services. They manufacture a variety of products including drugs, medical devices, and diagnostic products. It is a global company that operates in many countries.
When was Abbott founded?
Abbott was founded in 1902 as a small grocery store in Cleveland, Ohio, and today has grown into a multinational company with a broad product portfolio and a worldwide network of offices.
How many employees does the company have: 🙋🏽♂️🙋🏻♀️
Currently, Abbott Laboratories has a total of more than 115,000 employees.
P/E RATIO:
Abbott Laboratories has a current P/E ratio of just under 38.
Market capitalization: 🏦
Currently, Abbott Laboratories has a market capitalization of around 176 billion euros.
Dividend yield: 💰
The company pays its shareholders a nice dividend of currently over 1.80%. This payout is made on a quarterly basis. Abbott Laboratories shareholders receive their dividends in February, May, August, and November.
Strengths of the share: 📈
- They have a wide range of products in the healthcare sector.
- They operate in many countries and have a global network.
- They have a strong commitment to research and development.
- They have a long history and experience in the healthcare industry.
- They work closely with healthcare providers and other partners to improve patient care.
Weaknesses of the stock: 📉.
- The company operates in a very competitive industry.
- Some of their products have had negative impacts on patient health in the past.
- They have had some regulatory issues in the past.
- They have had patent disputes in some cases.
- They have had some public perception issues in the past.
The business model: ⬇️
Abbott Laboratories makes its money primarily by selling healthcare products worldwide. The group is one of the largest healthcare companies in the world and focuses mainly on four topics.
Pharmaceutical Products. This area includes international sales of a range of generic pharmaceuticals. These are agents for gastroenterology, women's health, cardiovascular and metabolic diseases, pain and central nervous system disorders, as well as respiratory drugs and vaccines. In this segment, the company generated sales of $4.7 billion in 2021, accounting for about 11% of total sales. It is interesting to note here that of USD 4.7 billion, 75% was generated in emerging markets.
Nutrition. In this segment, Abbott Laboratories is engaged in the global distribution of nutritional products for adults and children. The company produces specialty infant foods, protein foods, specialty diabetic foods, and enteral foods (artificial nutrition). In fiscal 2021, this business accounted for about 19% of Abbott's total revenue, with $8.3 billion in sales.
Diagnostics. This segment markets diagnostic systems and tests for global blood banks, hospitals, commercial laboratories and testing sites. This segment generated a lot of revenue in 2020, primarily from sales of Coronatests. At $15.6 billion, this was the top-selling segment in 2021. Overall, this accounted for just over 36% of total sales of $43 billion in 2021.
Medical Devices. In this segment, Abbott's products include pacemakers, cardiovascular devices, and diabetes monitoring devices. At $14.4 billion in sales, this segment is second only to diagnostics in terms of revenue. This segment accounts for just over 33% of total sales. The diabetic segment in particular is proving to be extremely lucrative for Abbott. Sales of diabetic monitors recently grew by 26%. Its FreeStyle Libre diabetic meter alone recently generated more than $1 billion in sales for the company.
A little more about the industry: ✌🏽
Abbott Laboratories operates in the healthcare industry. What makes the healthcare market special is crisis-proofing. People's health is important even in times of crisis, and it is hard to put off. It is the most precious commodity we have. You notice that especially when you're sick. Then no price is too high to pay to be cured. The long-term goal of the healthcare industry is to help mankind with all diseases. The global healthcare market is growing about 6% per year, according to the World Health Organization (WHO). Within the healthcare industry, Abbott is broadly diversified in many areas of health.
Due to an aging society as well as our lifestyles such as fast food and alcohol, there are many diseases that are becoming more prevalent. Poor nutrition in particular can lead to diabetes. 9% of the world's population suffers from this terrible disease and the number of diabetics is increasing every year. The potential market is huge. In 5 years, there will be 1 billion obese people in the world. To prevent secondary diseases, monitoring blood glucose level is very important. With its diabetes meters, Abbott is operating in a market that is expected to grow by 17% per year until 2025. At the same time, they are the market leader in blood glucose monitoring with a 54% market share.
The trend toward better nutrition is growing. Dietary supplements are frequently used to achieve this. By 2028, the market for dietary supplements is expected to grow by almost 9% per year. Health consciousness in conjunction with everyday life, which often becomes more stressful due to work, is the growth driver here. People often don't find the time to cook healthy meals, for example, and help themselves with dietary supplements. These also play an increasingly important role in sports. Furthermore, many people with chronic diseases need special nutritional products. These, too, are increasingly in demand as a result of demographic change. In the USA, Abbott is one of the market leaders in the field of nutritional supplements for adults.
The pandemic has given a strong boost to the diagnostics market. Demand for Coronatests has been immense worldwide. This has benefited the entire industry, which includes Abbott Laboratories. By 2028, this market is expected to grow by more than 12%. It will be exciting to see how the industry develops in the waning pandemic. As diagnostics are key to successful treatment and recovery, Abbott is well positioned with its diagnostic systems and tests in this market as well.
As a healthcare medical company, it benefits from consistent demand from its private and government customers. The industry is considered crisis-proof. After all, even in a recession, people need to monitor their blood glucose levels, and hospitals need medical equipment even in times of crisis. Without medical devices, patient care cannot be provided. With cardiovascular devices, pacemakers and diabetes monitors, Abbott Laboratories covers an important segment of medical devices. The global cardiovascular market is expected to grow at 7% per year.
Although on a smaller scale in terms of sales, Abbott Laboratories is also active in the pharmaceutical sector. This is one of the most lucrative industries of all. Although the pharmaceutical industry is already one of the largest in the world, it continues to grow steadily. It is expected to grow at a rate of over 3% per year. The overall prescription drug market is growing at 6% per year. This above-average growth is mainly due to demographic change.
Your opinion: 🤔🧐
Now I would like to hear your opinion about this stock in the comments.
What do you think of Abbott Laboratories and did you already know this company?
Do you guys maybe already have this stock in your portfolio?
Feel free to let me know in the comments.
Of course, this is not an investment advice but just my own opinion that I want to share with you.