ABBOTT LABORATORIES (ABT) Stock Analysis
ABBOTT LABORATORIES (ABT) Stock Analysis
Analysis from 10-Q filed 2025-10-29. Data as of Q4 2025.
Overall Grade: F (Concerning)
ABBOTT LABORATORIES faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 9.8% | Near cost of capital |
| FCF Margin | 16.7% | Strong cash generation |
| Debt/Equity | 0.2x | Conservative leverage |
Investment Thesis: Healthy free cash flow margin of 16.7% provides financial flexibility for growth and shareholder returns.
Explore ABBOTT LABORATORIES: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: ABBOTT LABORATORIES earns 9.8% ROIC, Top 50% in Healthcare
ABBOTT LABORATORIES's trailing-twelve-month ROIC of 9.8% ranks Top 50% in Healthcare companies (sector median: -3.9%), driven by NOPAT margin of 14.0% combined with asset turnover of 0.5x. Source: 10-Q filed 2025-10-29. Gross margin of 56.4% with operating margin at 18.2% reflects strong pricing power.
| Metric | ABT | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 9.8% | Adequate | Above sector median of -3.9% |
| Return on Equity (ROE) | 13.0% | Adequate | Moderate equity returns |
| Gross Margin | 56.4% | Excellent | Strong pricing power |
| Operating Margin | 18.2% | Good | Efficient operations |
Cash Flow: ABBOTT LABORATORIES generates $7.4B FCF at 16.7% margin, positive NaN/8 quarters
ABBOTT LABORATORIES generated $7.4B in free cash flow (TTM), a 16.7% FCF margin, a margin that ranks Top 5% in Healthcare. Operating cash flow exceeds net income by 1.5x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-10-29.
| Metric | ABT | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 16.7% | Good | Excellent cash conversion |
| Free Cash Flow (TTM) | $7.4B | Good | Positive cash generation |
| OCF/Net Income | 1.5x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: ABBOTT LABORATORIES at 0.2x leverage
ABBOTT LABORATORIES's debt-to-equity ratio of 0.2x reflects conservative leverage. Total debt of $12.9B offset by $8.9B in cash. Source: 10-Q filed 2025-10-29.
| Metric | ABT | Rating | Context |
|---|---|---|---|
| Debt to Equity | 0.2x | Excellent | Conservative capital structure |
| Net Cash Position | $-4.0B | Warning | Net debt position |
Valuation: ABBOTT LABORATORIES trades at 33.6x earnings
ABBOTT LABORATORIES trades at a P/E of 33.6x. Free cash flow yield of 3.4% reflects market expectations for growth.
| Metric | ABT | Rating | Context |
|---|---|---|---|
| P/E Ratio | 33.6x | Adequate | Premium valuation |
| EV/Sales | 5.0x | Adequate | Growth premium priced in |
| FCF Yield | 3.4% | Adequate | Lower cash yield |
| Dividend Yield | 1.9% | Adequate | Growth focus over income |
Capital Allocation: ABBOTT LABORATORIES returns 2.3% shareholder yield
ABBOTT LABORATORIES's total shareholder yield is 2.3% (dividends 1.9% + buybacks 0.4%). Source: 10-Q filed 2025-10-29.
| Metric | ABT | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 2.3% | Adequate | Dividend + buyback yield combined |
| Buyback Yield | 0.4% | Adequate | Minimal buyback activity |
| Total Capital Returned (TTM) | $5.0B | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 9.8% | Top 50% | - |
| Free Cash Flow Margin | 16.7% | Top 5% | - |
| Gross Margin | 56.4% | Bottom 50% | 0.9x below |
| Operating Margin | 18.2% | Top 25% | 9.5x above |
| Return on Equity (ROE) | 13.0% | Top 25% | - |
| P/E Ratio | 33.6x | N/A | - |
Financial Scorecard
| Metric | ABT | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 9.8% | Adequate | Top 50% of sector (median: -3.9%) |
| Free Cash Flow Margin | 16.7% | Good | Top 5% of sector (median: 0.0%) |
| Gross Margin | 56.4% | Excellent | Bottom 50% of sector (median: 64.0%) |
| Debt to Equity Ratio | 24.8% | Excellent | Conservative capital structure |
| P/E Ratio (Price-to-Earnings) | 33.6x | Adequate | Growth premium |
| Free Cash Flow Yield | 3.4% | Adequate | Moderate yield |
Frequently Asked Questions
Q: What is ABBOTT LABORATORIES's Return on Invested Capital (ROIC)?
ABBOTT LABORATORIES (ABT) has a trailing twelve-month Return on Invested Capital (ROIC) of 9.8%. This compares above the sector median of -3.9%. An ROIC near 8-12% is approximately the cost of capital for most companies.
Q: What is ABBOTT LABORATORIES's Free Cash Flow Margin?
ABBOTT LABORATORIES (ABT) has a free cash flow margin of 16.7%, generating $7.4 billion in free cash flow over the trailing twelve months. A FCF margin between 10-20% represents healthy cash generation for most industries.
Q: Is ABBOTT LABORATORIES stock overvalued or undervalued?
ABBOTT LABORATORIES (ABT) trades at a P/E ratio of 33.6x, which is above the sector median of N/A. The EV/Sales multiple is 5.0x. Free cash flow yield is 3.4%, which is in line with market averages.
Q: Does ABBOTT LABORATORIES pay a dividend?
ABBOTT LABORATORIES (ABT) currently pays a dividend yield of 1.9%. Including share buybacks, the total shareholder yield is 2.3%. The relatively low yield suggests the company prioritizes growth reinvestment over income distribution.
Q: What is ABBOTT LABORATORIES's revenue and earnings growth?
ABBOTT LABORATORIES (ABT) grew revenue by 5.7% year-over-year. Earnings per share decreased by 51.2% compared to the prior year. Modest growth indicates a mature business with stable demand.
Q: Is ABBOTT LABORATORIES buying back stock?
ABBOTT LABORATORIES (ABT) repurchased $893.0 million of stock over the trailing twelve months. This represents a buyback yield of 0.4%.
Q: How does ABBOTT LABORATORIES compare to competitors in Healthcare?
Compared to other companies in Healthcare, ABBOTT LABORATORIES (ABT) shows: ROIC of 9.8% is above the sector median of -3.9% (Top 26%). FCF margin of 16.7% exceeds the sector median of 0.0% (Top 0% of sector). Gross margin at 56.4% is 7.5 percentage points lower than sector peers. These rankings are based on MetricDuck's analysis of all Healthcare companies with available SEC filings.
Q: What warning signs should I watch for with ABBOTT LABORATORIES?
Investors in ABBOTT LABORATORIES (ABT) should monitor these potential warning signs: 1) ROIC has been declining, potentially signaling deteriorating competitive position. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-10-29. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.