ABT
ABBOTT LABORATORIESNYSEValuation snapshot
Above bull casePrice is above even the bull case.
Price as of Sep 4, 2026 · Valuation Sep 6, 2026
What drives ABT's base case?
base-case thesisAbbott enters the forecast with improving annual sales and strong medical-device demand. Exact Sciences adds a meaningful cancer-testing business, while glucose monitoring, heart devices, and emerging-market medicines continue growing. Slower nutrition and respiratory-testing sales temper the result, but a richer product mix gradually improves profitability.
What shapes the assumptions
Medical Devices generated $21.387 billion of 2025 sales after two years of growth above 0.12
Medical Devices annual sales
Raises revenue growth
Exact Sciences generated $3.247 billion of 2025 sales before acquisition
Acquired cancer-diagnostics sales
Raises revenue growth
Medical Devices' segment profitability rose to about 0.337 in 2025
Medical Devices segment profitability
Raises operating margin
Capital spending declined to about 0.049 of sales in 2025
Capital spending intensity
Lowers reinvestment
Each driver links a business metric to the forecast assumption it shapes — the basis for this case, not investment advice.
Why the gap?
The market is pricing this as if revenue grows 23.0% a year. Over the last 5 years it grew 3.9% a year — so the price assumes far more than it has delivered.
What else could explain it?›
- Or, holding growth steady
- the price is also consistent with a 37.6% operating margin, against the 20.0% assumed here.
- How confident is this estimate?
- Robustness 49.0/10 (Moderate) — some of any gap is our own uncertainty rather than disagreement.
- What would change the answer?
- Which assumption this valuation swings on, and by how much.
Many combinations of assumptions reproduce the same price. These are ways to read what the market might be expecting, not the market's actual view. How this is worked out
Research & assumptions
Inspect the valuation thesis, cases, risks, evidence, and model inputs.
View details
Research & assumptions
Inspect the valuation thesis, cases, risks, evidence, and model inputs.
Three independently researched cases generated automatically from published financials. Every assumption is justified and cited; the discount rate is computed from researched market inputs.
Company value drivers
Ranked operating metrics and the valuation assumptions they influence.
1. Medical Devices annual sales
This measures the scale of Abbott's largest and fastest-growing segment, which is the principal source of company sales growth.
$21B
reported2. Medical Devices annual segment profitability
This tracks whether growth in Abbott's largest segment is producing the expected scale benefits and improving the company sales mix.
33.7%
derived3. Continuous-glucose-monitor annual sales
This measures adoption of Abbott's largest high-growth product platform and indicates whether recurring sensor demand remains a major company growth engine.
$7.6B
reported4. Annual capital spending as a share of sales
This measures how much physical investment Abbott requires to support each dollar of sales and therefore constrains cash available to investors.
4.9%
derived5. Annual company reported profitability
This measures the share of company sales remaining after reported operating costs and captures mix, pricing, productivity, amortization, and integration effects together.
18.2%
derivedBase inputs from financials
source period →Base revenue (TTM)
$45.1B
Diluted shares
1,747,073,000
Net cash
-$27.2B
Bear
low confidence$23.64
IV / share
-78.3% vs $108.79
- Explicit cash flows
- $8.80
- Terminal value
- $30.43
- Net cash
- -$15.59
- Intrinsic value / share
- $23.64
128.7% of the value rests on the terminal value — high dependency. A small change to terminal growth moves the valuation a lot — see terminal growth below.
Revenue growth9.0% → 5.0% → 4.5% → 4.0% → 3.5%medium
How derived: The first year includes most of Exact Sciences' annual revenue while assuming underlying growth below management's 0.065-to-0.075 guidance, followed by slowing growth as weak Nutrition and Diagnostics offset Medical Devices.
Why this confidence: Management guidance and reported segment results ↑, Uncertain Exact Sciences integration and five-year horizon ↓
Measured by
- Medical Devices annual sales$21Breported
- Continuous-glucose-monitor annual sales$7.6Breported
Evidence for
- First-quarter 2026 comparable sales grew only 0.037, with Nutrition declining 0.077 and Diagnostics growing 0.018.[Abbott Q1 2026 results]· primary
Evidence against
- Management projected full-year 2026 comparable sales growth of 0.065 to 0.075, while first-quarter Medical Devices and Established Pharmaceuticals grew 0.085 and 0.09, respectively, on a comparable basis.[Abbott Q1 2026 results]· primary
Operating margin17.0%medium
How derived: The target stays below the 2025 company margin of about 0.182 because Exact Sciences amortization and integration costs, weak Nutrition volumes, and higher acquisition debt may prevent recent margin gains from holding.
Why this confidence: Three years of reported company and segment profitability ↑, Temporary acquisition charges obscure normalized profitability ↓
Measured by
- Medical Devices annual sales$21Breported
- Medical Devices annual segment profitability33.7%derived
- Continuous-glucose-monitor annual sales$7.6Breported
- Annual company reported profitability18.2%derived
Evidence for
- First-quarter 2026 reported operating earnings fell to $1.345 billion from $1.693 billion, producing a margin near 0.12 as acquisition-related expenses increased.[Abbott Q1 2026 results]· primary
Evidence against
- Company operating earnings rose from $6.478 billion in 2023 to $8.053 billion in 2025, while Medical Devices' segment margin increased from about 0.314 to 0.337.[Abbott 2025 Form 10-K]· primary
Tax rate24.0%medium
How derived: The assumption starts from Abbott's 2025 effective rate of 0.229 and adds a cushion for global minimum-tax rules, uncertain foreign tax benefits, and acquisition-related changes.
Why this confidence: Audited tax reconciliation ↑, Volatile discrete tax items and evolving international rules ↓
No tracked driver measures this assumption yet.
Evidence for
- Abbott reported a 2025 effective tax rate of 0.229 and warned that changing international tax rules could materially increase its rate.[Abbott 2025 Form 10-K]· primary
Evidence against
- Abbott's 2023 effective tax rate was 0.141, demonstrating that foreign operations and tax credits can reduce the rate substantially.[Abbott 2025 Form 10-K]· primary
Reinvestment rate45.0%low
How derived: The model retains 0.45 of after-tax operating earnings because Abbott must fund manufacturing capacity, customer instruments, roughly 0.07-of-sales research spending, and a potentially inefficient Exact Sciences integration.
Why this confidence: Audited capital-spending and research data ↑, Reinvestment includes judgment about working capital and acquisition integration ↓
Measured by
- Annual capital spending as a share of sales4.9%derived
Evidence for
- Abbott spent $2.171 billion on property and equipment in 2025, targeted 2026 research spending near 0.07 of sales, and acquired approximately $12.8 billion of amortizable intangibles with Exact Sciences.[Abbott filings]· primary
Evidence against
- Capital spending remained near $2.2 billion from 2023 through 2025 even as revenue increased, indicating improving capital efficiency before the acquisition.[Abbott 2025 Form 10-K]· primary
Terminal growth2.0%low
How derived: Long-run growth is held to 0.02 because Abbott's diversified healthcare demand is durable but pricing pressure, currency exposure, regulation, and maturing product categories should limit growth.
Why this confidence: Diversified global healthcare demand ↑, Terminal assumptions extend beyond observable management guidance ↓
Measured by
- Continuous-glucose-monitor annual sales$7.6Breported
Evidence for
- Abbott states that price controls, competition, rebates, regulation, and currency translation can reduce revenue and earnings; international markets represented 0.61 of 2025 sales.[Abbott 2025 Form 10-K]· primary
Evidence against
- Emerging markets represented 0.37 of company sales and grew 0.051 excluding currency in 2025, while Medical Devices grew 0.119 excluding currency.[Abbott 2025 Form 10-K]· primary
Base
low confidence$50.58
IV / share
-53.5% vs $108.79
- Explicit cash flows
- $13.44
- Terminal value
- $52.73
- Net cash
- -$15.59
- Intrinsic value / share
- $50.58
104.3% of the value rests on the terminal value — high dependency. A small change to terminal growth moves the valuation a lot — see terminal growth below.
Revenue growth12.5% → 7.5% → 6.5% → 5.5% → 4.5%medium
How derived: The first year combines management's 0.065-to-0.075 comparable-growth outlook with most of Exact Sciences' $3.247 billion annual revenue, after which Medical Devices and cancer diagnostics support a gradual decline toward mature growth.
Why this confidence: Management guidance and disclosed acquired revenue ↑, Limited post-acquisition operating history ↓
Measured by
- Medical Devices annual sales$21Breported
- Continuous-glucose-monitor annual sales$7.6Breported
Price implies: 23.0% vs our 7.3% — one of several sets that fit this price
Evidence for
- Management projected 2026 comparable sales growth of 0.065 to 0.075, and Exact Sciences generated $3.247 billion of sales in 2025 but contributed only $96 million after the March 23 closing in the first quarter.[Abbott Q1 2026 results]· primary
Evidence against
- First-quarter comparable company growth was 0.037, below full-year guidance, as Nutrition declined 0.077 and Rapid and Molecular Diagnostics declined 0.096.[Abbott Q1 2026 results]· primary
Operating margin20.0%medium
How derived: The target builds moderately on the 2025 company margin of about 0.182 as higher-margin Medical Devices become a larger share of sales and restructuring offsets declining acquired-intangible amortization.
Why this confidence: Consistent Medical Devices margin expansion ↑, Uncertain timing of Exact Sciences synergies and amortization decline ↓
Measured by
- Medical Devices annual sales$21Breported
- Medical Devices annual segment profitability33.7%derived
- Continuous-glucose-monitor annual sales$7.6Breported
- Annual company reported profitability18.2%derived
Price implies: 37.6% vs our 20.0% — one of several sets that fit this price
Evidence for
- Medical Devices' segment margin rose from about 0.314 in 2023 to 0.337 in 2025, and company gross margin increased from 0.503 to 0.526.[Abbott 2025 Form 10-K]· primary
Evidence against
- Exact Sciences increased annual intangible amortization expectations to approximately $2.6 billion in 2026 and $2.3 billion in 2027, while first-quarter company profitability fell to about 0.12 of sales.[Abbott Q1 2026 Form 10-Q]· primary
Tax rate22.0%medium
How derived: The assumption rounds the 2025 effective rate of 0.229 toward the 0.21 U.S. statutory rate while allowing continuing foreign tax differences and credits.
Why this confidence: Current audited effective rate and statutory benchmark ↑, Material foreign and discrete tax adjustments ↓
No tracked driver measures this assumption yet.
Evidence for
- Abbott's 2025 tax reconciliation reported a 0.229 effective rate versus a 0.21 U.S. federal statutory rate.[Abbott 2025 Form 10-K]· primary
Evidence against
- The 2023 rate was 0.141, 2024 contained an unusually large non-cash tax benefit, and first-quarter 2026 taxes included discrete adjustments, showing that the reported rate is volatile.[Abbott filings]· primary
Reinvestment rate35.0%low
How derived: The model retains 0.35 of after-tax operating earnings, reflecting capital spending near 0.05 of sales plus sustained research investment, partly offset by Abbott's improving pre-acquisition capital efficiency.
Why this confidence: Comparable three-year capital-spending history ↑, Working-capital needs and acquisition integration are difficult to normalize ↓
Measured by
- Annual capital spending as a share of sales4.9%derived
Evidence for
- Property-and-equipment purchases were $2.202 billion, $2.207 billion, and $2.171 billion in 2023, 2024, and 2025, and Abbott targeted research spending near 0.07 of 2026 sales.[Abbott 2025 Form 10-K]· primary
Evidence against
- Capital spending declined from about 0.055 of sales in 2023 to about 0.049 in 2025, suggesting that incremental growth has required less physical capital.[Abbott 2025 Form 10-K]· primary
Terminal growth2.5%low
How derived: Long-run growth of 0.025 balances durable healthcare demand and emerging-market exposure against mature categories, regulation, pricing pressure, and foreign-exchange risk.
Why this confidence: Broad product and geographic diversification ↑, Very long forecast horizon ↓
Measured by
- Continuous-glucose-monitor annual sales$7.6Breported
Evidence for
- Emerging markets represented 0.37 of sales and grew 0.051 excluding currency in 2025, while Abbott maintains diversified positions across devices, diagnostics, nutrition, and branded medicines.[Abbott 2025 Form 10-K]· primary
Evidence against
- Abbott reports continuing pricing pressure, government cost controls, rebate exposure, and currency sensitivity across international operations.[Abbott 2025 Form 10-K]· primary
Bull
low confidence$79.41
IV / share
-27.0% vs $108.79
- Explicit cash flows
- $17.32
- Terminal value
- $77.69
- Net cash
- -$15.59
- Intrinsic value / share
- $79.41
97.8% of the value rests on the terminal value — high dependency. A small change to terminal growth moves the valuation a lot — see terminal growth below.
Revenue growth15.0% → 10.0% → 8.5% → 7.0% → 5.5%low
How derived: The first year assumes full capture of the Exact Sciences consolidation uplift plus performance near the top of guidance, followed by sustained share gains in glucose monitoring, heart devices, cancer diagnostics, and emerging-market medicines.
Why this confidence: Strong reported growth in the largest segment ↑, Assumes sustained product success above company-wide recent growth ↓
Measured by
- Medical Devices annual sales$21Breported
- Continuous-glucose-monitor annual sales$7.6Breported
Evidence for
- First-quarter Medical Devices sales grew 0.085 on a comparable basis, Established Pharmaceuticals grew 0.09, and acquired Cancer Diagnostics posted double-digit Cologuard growth.[Abbott Q1 2026 results]· primary
Evidence against
- Total-company comparable growth was only 0.037 in the first quarter, with Nutrition down 0.077 and Rapid and Molecular Diagnostics down 0.096.[Abbott Q1 2026 results]· primary
Operating margin22.0%low
How derived: The target assumes Medical Devices' rising mix, restructuring savings, acquisition synergies, and declining intangible amortization lift company profitability meaningfully above the 2025 level of about 0.182.
Why this confidence: Established Medical Devices scale benefits ↑, Requires successful acquisition integration and substantial company-wide improvement ↓
Measured by
- Medical Devices annual sales$21Breported
- Medical Devices annual segment profitability33.7%derived
- Continuous-glucose-monitor annual sales$7.6Breported
- Annual company reported profitability18.2%derived
Evidence for
- Medical Devices' segment profitability increased each year from about 0.314 in 2023 to 0.337 in 2025, and the segment's operating earnings grew 0.172 in 2025.[Abbott 2025 Form 10-K]· primary
Evidence against
- First-quarter 2026 reported operating earnings declined 0.206, and acquired-intangible amortization is expected to remain at least $1.5 billion annually through 2030.[Abbott Q1 2026 Form 10-Q]· primary
Tax rate20.0%low
How derived: The rate assumes Abbott's geographic mix, research credits, and foreign-derived income benefits keep taxes slightly below the 0.21 U.S. statutory rate after unusual items normalize.
Why this confidence: Documented recurring tax benefits ↑, Assumption is below the latest effective rate ↓
No tracked driver measures this assumption yet.
Evidence for
- Abbott's reconciliation identifies foreign tax differentials, foreign-derived intangible income, and research credits that can reduce taxes below the U.S. statutory rate.[Abbott 2025 Form 10-K]· primary
Evidence against
- The 2025 effective tax rate was 0.229, and Abbott warns that international tax-law changes could materially increase its rate.[Abbott 2025 Form 10-K]· primary
Reinvestment rate30.0%low
How derived: The model retains 0.30 of after-tax operating earnings because software-enabled diagnostics, recurring sensors and tests, and improving capital-spending intensity allow faster growth without proportional physical investment.
Why this confidence: Observed decline in capital intensity ↑, High growth may require more capacity and commercialization spending than assumed ↓
Measured by
- Annual capital spending as a share of sales4.9%derived
Evidence for
- Capital spending fell from about 0.055 of sales in 2023 to about 0.049 in 2025 while Medical Devices sales increased from $16.887 billion to $21.387 billion.[Abbott 2025 Form 10-K]· primary
Evidence against
- Abbott plans research spending near 0.07 of sales and states that ongoing substantial investment is necessary to remain competitive and launch new technologies.[Abbott 2025 Form 10-K]· primary
Terminal growth3.0%low
How derived: The 0.03 long-run rate assumes Abbott continues benefiting from chronic-disease demand, recurring sensor and diagnostic use, and faster-growing emerging markets without indefinitely matching its current product-level growth.
Why this confidence: Recurring chronic-care products and emerging-market exposure ↑, High perpetual-growth assumption and regulatory uncertainty ↓
Measured by
- Continuous-glucose-monitor annual sales$7.6Breported
Evidence for
- Continuous-glucose-monitor sales reached $7.6 billion in 2025 after 0.174 currency-neutral growth, and Exact Sciences adds recurring cancer-screening products to Abbott's portfolio.[Abbott filings and Q1 results]· primary
Evidence against
- Nutrition was nearly flat in 2025, Diagnostics declined 0.045 excluding currency, and Abbott faces price controls and currency exposure across international markets.[Abbott 2025 Form 10-K]· primary
Valuation robustness
reliability of the estimate, not a stock rating49 / 100 · Moderate
Formula v1.0.0. Higher means a more reliable estimate — not a recommendation.
Quality checks
Automated model-risk flags — warnings, not recommendations.
- 104% of the intrinsic value rests on the terminal value — a small change to terminal growth moves the valuation a lot.→ terminal growth
- The reinvestment assumption is low-confidence.→ reinvestment
- The terminal growth assumption is low-confidence.→ terminal growth
Per-share economics
Business growth after changes in the diluted share count.
| Period | Revenue growth | FCF/share | FCF/share growth | Shares | Share growth |
|---|---|---|---|---|---|
| Q2 2024 | 4.0% | 0.81 | 104.9% | 1.75B | 0.1% |
| Q3 2024 | 4.9% | 1.23 | 63.2% | 1.75B | -0.0% |
| Q1 2025 | 4.0% | 0.53 | 49.0% | 1.75B | -0.1% |
| Q2 2025 | 7.4% | 0.88 | 8.3% | 1.75B | -0.0% |
| Q3 2025 | 6.9% | 1.31 | 6.5% | 1.75B | 0.1% |
| Q1 2026 | 7.8% | 0.52 | -1.8% | 1.75B | -0.0% |
Valuation history every run
History builds as the valuation is recalculated — this is the first recorded run.
Market inputs researched
The 10-year U.S. Treasury par yield on the latest trading day is used as the nominal U.S.-dollar risk-free rate.
The January 2026 levered beta for 204 U.S. Healthcare Products companies is used as a diversified bottom-up beta for Abbott.
The latest published trailing-earnings, adjusted-payout implied premium is used because it is forward-looking and internally consistent with current market prices.
The latest available regular-session closing price is used as the market-price comparison input.
Generated 9/6/2026, 3:02:55 AM · pipeline v1.2.0