Abbott Labs bounces off of the lower rail of an upwardly sloped channel
Abbott Laboratories (NYSE: ABT) is classified as a diversified medical company because the company develops generic pharmaceuticals and nutritional supplements, but it also develops diagnostic systems. The diversification might not seem like a big deal, but it could help the company in the long run. The current political environment has brought attention to the costs of prescription drugs in the United States and with Abbott developing generic drugs and also having the cushion of developing nutritional supplements and diagnostic systems as well, it could actually benefit from additional regulation in the industry.
Regardless of what happens going forward, the company has performed very well in recent years and so has the stock. The company has seen earnings grow by a rate of 13% per year over the last three years while sales have grown by a rate of 18%. Earnings increased by 12% in the most recent quarterly report while sales were up 3%. Analysts expect earnings to increase by 13% for 2019 while sales are expected to increase by 4.4%.
The management efficiency measurements are slightly above average with a return on equity of 16.7% and a profit margin of 19.5%.
The Tickeron Valuation Rating system shows a current reading of 3 for Abbott and that indicates that the company is seriously undervalued in the industry. A rating of 1 points to the most undervalued stocks, while a rating of 100 points to the most overvalued stocks. The stock’s price-to-book ratio, P/E ratio, and PEF Ratio are all below the industry averages.
The Tickeron Price Growth Rating for this company is 8, indicating outstanding price growth and meaning that Abbott’s price has grown at a higher rate over the last 12 months as compared to S&P 500 index constituents. A rating of 1 points to highest price growth (largest percent return), while a rating of 100 points to lowest price growth (smallest percent return).
Also from Tickeron we see a Profit vs. Risk rating for Abbott of 9, indicating low risk on high returns. The average Profit vs. Risk rating for the industry is 75, placing this stock better than average.
Looking at the daily chart for Abbott we see that the stock has been trending higher over the last four months and a trend channel has formed that defines the different cycles within the overall trend.
We see that the upper rail connects the highs from April, June, and July while the parallel lower rail connects the lows from May and August. The stock just hit the lower rail in the last week and has since turned higher. It is worth noting that the stock moved back above its 50-day moving average in the last few days.
The daily stochastic readings show low readings, but not quite low enough to get to oversold territory. It is interesting that the indicators did a little double dip in the last few weeks.
The stock briefly broke below its lower Bollinger Band earlier this month and according to the Tickeron Technical Analysis Overview, when that has happened in the past, the stock moved higher 63% of the time over the next month.
One area of concern for Abbott is the sentiment toward the company. Analysts are pretty bullish on the company with 18 out of 21 ratings falling in the “buy” or “overweight” category. There are also two “hold” ratings and one “underweight” rating.
The short interest ratio is a little higher than average at 3.3. The total number of shares sold short did jump significantly in July with total short interest jumping from 14.15 million to 16.99 million from the end of June through the end of July. This indicates growing bearish sentiment.
ABT sees MACD Histogram just turned negative
ABT saw its Moving Average Convergence Divergence Histogram (MACD) turn negative on December 03, 2024. This is a bearish signal that suggests the stock could decline going forward. Tickeron's A.I.dvisor looked at 49 instances where the indicator turned negative. In of the 49 cases the stock moved lower in the days that followed. This puts the odds of a downward move at .
Technical Analysis (Indicators)
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on December 03, 2024. You may want to consider selling the stock, shorting the stock, or exploring put options on ABT as a result. In of 90 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
ABT moved below its 50-day moving average on December 05, 2024 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ABT declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
Bullish Trend Analysis
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 4 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where ABT advanced for three days, in of 313 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 289 cases where ABT Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (5.038) is normal, around the industry mean (23.246). P/E Ratio (34.383) is within average values for comparable stocks, (83.568). Projected Growth (PEG Ratio) (6.149) is also within normal values, averaging (5.667). Dividend Yield (0.019) settles around the average of (0.018) among similar stocks. P/S Ratio (4.888) is also within normal values, averaging (43.227).
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 88, placing this stock slightly better than average.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. ABT’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
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General Information
a manufacturer of health care products
Industry MedicalSpecialties