Abbott Laboratories (NYSE:ABT) is one of the top 10 picks in President Trump’s latest stock portfolio. Trump bought $1 million to $5 million of Abbott in August. He wasn’t the only notable name loading up on the stock.
Billionaires Added Abbott in Q2
Famous investors were buying Abbott in the second quarter too. Ken Griffin’s Citadel Investment Group raised its stake by 349% to 8.6 million shares, worth $780.1 million at the end of June, or 0.09% of its portfolio. Paul Marshall and Ian Wace’s Marshall Wace added 176% to 5.5 million shares worth $502.9 million, or 0.4% of its portfolio. Cliff Asness’s AQR Capital Management added 167% to 4.2 million shares worth $380.5 million, and Israel Englander’s Millennium Management added 173% to 3.6 million shares worth $326.7 million. Paul Tudor Jones’s Tudor Investment Corp raised its stake by 124% to 730,332 shares worth $66.3 million. Ric Dillon’s Diamond Hill Capital holds 4.9 million shares worth $448 million, which is 3.59% of its portfolio, even after a 9% trim. Abbott also made our list of the 12 best monopoly stocks to buy according to hedge funds. Check out the other 11 stocks.
Ken Fisher’s Fisher Asset Management, however, cut its stake by 33%.
Why Abbott Stock Is Down
Abbott is down about 19% over the past year because several problems hit at once. Nutrition sales kept falling, and the stock dropped about 8% in January when fourth-quarter revenue missed estimates and the 2026 guidance came in below expectations. The FDA also classified a recall of certain lots of FreeStyle Libre 3 and Libre 3 Plus sensors as Class I, its most serious type. In April, it cut its 2026 profit forecast to include the deal’s dilution and a weak flu season, and the shares fell about 5% that day. Abbott beat estimates in July and the stock rose, but it has not made up the losses.
Photo by National Cancer Institute on Unsplash
Bull Case
Bulls like Abbott because it has several ways to grow. Medical devices lead the business, with comparable growth of 8.4% in the second quarter, led by heart rhythm and heart failure devices. FreeStyle Libre sales still grew 7.5% in the first quarter even with the recall, and the new Libre Duo sensor, which tracks glucose and ketones, won approval in Europe. The Exact Sciences deal brought in Cologuard, a leading at-home colon cancer test, and it fills a hole in diagnostics left by fading COVID testing. Cancer diagnostics grew 13.3% in the second quarter. Abbott expects the deal to add to earnings from 2028, and it raised its full-year earnings forecast after the second quarter. Jim Cramer said the deal plugs a gap in Abbott’s diagnostics business. Read what else he said. The stock also yields about 2.4%, and the whole medical device group is out of favor. MedTech stocks are as cheap as they have been in a decade, Barclays said in a note that rated Abbott Overweight.
Bear Case
Bears point to a second half that still has to prove itself. Sales growth on a comparable basis was 4.8% in the second quarter, against guidance of 6.5% to 7.5% for the year, so growth has to speed up. The Exact Sciences deal cuts adjusted earnings in 2026 and 2027, and Abbott borrowed heavily to pay for it, so the integration has to go smoothly. Nutrition sales remain weak. The Libre recall and the FDA warning letter leave regulatory risk around one of Abbott’s key growth products, and Libre growth has already slowed.
Valuation
Abbott trades at 19.01 times forward adjusted earnings, a 1% discount to the sector median of 19.13 and 18% below its own five-year average of 23.06. On a GAAP basis, the forward P/E is 30.95 against a sector median of 24.59, because the deal adds one-time costs. Revenue grew 8.06% over the past year. The PEG ratio is 2.06 against a sector median of 1.87, so investors pay a small premium for each point of growth. It sits 28% below Abbott’s own five-year average of 2.85. Matrix Asset Advisors started a new position in Abbott in the second quarter. Read their full thesis.
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