Abbott Laboratories (ABT), AbbVie Inc (ABBV) & More: Did You Know That This Stock Is Half What It Had Been?

3 High-Yield Pharma Stocks With Major CatalystsTechnically, Abbott Laboratories (NYSE:ABT) stock is trading at half of its 52-week high.

But only technically.

Abbott Laboratories (NYSE:ABT) stock hit a high in October of last year of 72.47, but when the new year hit, the company split in two, spinning its drug assets into AbbVie Inc (NYSE:ABBV). Investors that continued to hold AbbVie Inc (NYSE:ABBV) stock and Abbott Laboratories (NYSE:ABT) stock are looking at a combined value above $80 per share.

Much better.

Off the drugs
Without its drug division, first-quarter earnings required a little juggling to compare apples to apples. Diluted earnings per common share from continuing operations, excluding specified items — wow, that’s a mouthful — increased 5% compared to the same metric as the year-ago quarter. Basically, the company is pretending like it didn’t own AbbVie Inc (NYSE:ABBV) and then backing out special items from both quarters.

The nutrition business helped drive sales up 3.5% at constant currency. Sales of baby formula and the like were up 9% at constant currencies. Diagnostics were up 6.4% year over year, ignoring currency changes.

Dragging down sales were medical devices, which saw sales drop 3% at constant currency. Much of the decline came from sales of its drug-eluting stent and related products, which fell 15% in the U.S. compared to the first quarter of 2012. U.S. sales are being dragged down by pricing pressure as it competes with Boston Scientific Corporation (NYSE:BSX) and decreased usage by the doctors. Boston Scientific Corporation (NYSE:BSX) reported a similar experience with U.S. sales of drug-eluting stents down a whopping 33%.

Outside the U.S. sales of the segment actually increased 6.7% thanks to launches into new territories. It’s easy to see growth when the comparing quarter has zero sales. Boston Scientific Corporation (NYSE:BSX) wasn’t able to manage that, international sales were down 6.5%

You’ll recall that Johnson & Johnson (NYSE:JNJ) saw the writing on the walls and exited the drug-eluting stent business altogether. One has to wonder how long Abbott will give it. Abbott Laboratories (NYSE:ABT) stock might actually go up if the company followed Johnson & Johnson (NYSE:JNJ)’s lead.
I doubt we’ll see that happen, Abbott just got a new stent, Xience Xpedition, approved in January. Maybe the newest offering can turn things around.

Is Abbott Laboratories stock a buy?
I can see why Abbott Laboratories (NYSE:ABT) split off its drug business; the aforementioned growth in the combined stock price highlights the released value.

Of the two, though, I think AbbVie has greater potential for growth. It’s exposed to potential generic competition for its megablockbuster, Humira, but it has a nice pipeline to back it up.

Abbott Laboratories (NYSE:ABT) stock isn’t going to go anywhere until the company can get its medical device division moving back in the right direction. Unless you’re content with holding to collect the dividend, I’d recommend watching for the turnaround before investing.

The article Abbott Laboratories Stock Is Half What It Used to Be originally appeared on Fool.com and is written by Brian Orelli.

Fool contributor Brian Orelli has no position in any stocks mentioned. The Motley Fool recommends Johnson & Johnson. The Motley Fool owns shares of Johnson & Johnson.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!