The Zacks Analyst Blog Highlights Abbott Laboratories, Boston Scientific and Medtronic

For Immediate ReleaseChicago, IL – April 28, 2025 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Abbott Laboratories ABT, Boston Scientific BSX and Medtronic MDT.Here are highlights from Friday’s Analyst Blog:Tariffs Cast Shadow on Abbott Labs' 2025 View: Time to Sell the Stock?Abbott Laboratories has recorded a 15% rise in its share price year to date. Despite the company reporting a solid first-quarter 2025 earnings beat last week, external pressure, particularly the ongoing tariff war, has dampened investors' enthusiasm and capped further market gains. Let's delve deeper.Since its earnings release on April 16, shares of Abbott have edged down 0.2%, underperforming the industry as well as the S&P 500’s gain of 2%. The broader Medical sector collectively gained 1% during this period. The company’s archrivals like Boston Scientific and Medtronic registered share price improvements of 6.2% and 2%, respectively, during the said period.Tariffs Threaten Growth TrajectoryOn the first-quarter earnings call, Abbott outlined the projected financial repercussions of U.S. tariffs imposed by the Trump administration. The company estimated the direct hit to be in the range of “a few hundred million dollars” for the current year. While the company claimed this figure would remain manageable in the near term, the concern lies in the longevity and unpredictability of tariff enforcement.These tariffs are particularly consequential given that Abbott’s product portfolio, ranging from infant nutrition to advanced medical devices, relies heavily on global production and distribution networks. With certain devices being imported into the United States from overseas, tariff-induced cost pressure is set to rise, starting from the third quarter of 2025.Defensive Strategy Might Improve SituationWhile the trade policy environment introduces complexity, Abbott’s management remains confident about the company’s ability to weather the storm. The company’s global footprint with 90 manufacturing sites worldwide balances out the regional risks and gives the company scope to reroute supply chains when necessary. This diversified business model is expected to provide a degree of flexibility that the company’s peers may lack.The company is currently studying long-term strategies to minimize tariff exposure. Options under consideration include leveraging its manufacturing base to localize production and avoid cross-border duties, optimizing supplier contracts and potentially passing on some of the increased costs to customers.Two Impressive Long-Term TakeawaysEPD Set for Sustainable Growth: Abbott’s EPD operates solely in emerging geographies, with leading positions in many of the largest and fastest-growing pharmaceutical markets for branded generics in the world. These markets include India, Russia, China and Latin America. Banking on the successful execution of its Branded Generic operating model, EPD is well-positioned for sustained growth in many of these growing pharmaceutical markets. Focusing on the therapies most needed in the faster-growing markets, Abbott continues to sustain its long track record of delivering strong growth, which includes a five-year CAGR for EPD of 8%.Abbott’s EPD sales in the first quarter of 2025 increased 8% organically. More than half of its top 15 markets posted double-digit gains. Abbott’s strategic focus on biosimilars further strengthens its prospects, with the company now securing rights to 15 biosimilar products across key therapeutic areas.Libre Drives Diabetes Care: Abbott’s Diabetes Care business continued to benefit from the growing sales of its flagship, sensor-based continuous glucose monitoring system, FreeStyle Libre. In a relatively short span, FreeStyle Libre has achieved global leadership among continuous glucose monitoring (CGM) systems for both Type 1 and Type 2 users. Lately, the company has been gaining momentum, leveraging consistent upgrades of FreeStyle Libre.In 2024, Abbott obtained FDA approvals for two new over-the-counter continuous glucose monitoring systems called Lingo and Libre Rio, which are based on Libre’s technology, which is now used by more than 6 million people around the world. This over-the-counter availability of CGM marks the initiation of a new era for Abbott in the United States.In the first quarter, in Diabetes Care, sales of CGM exceeded $1.7 billion and grew 21.6%. Several products contributed to the strong performance, including FreeStyle Libre, Navitor, TriClip, Amplatzer Amulet and AVEIR.Long-Term Potential Hindered by Short-Term WeaknessAbbott is currently trading below its 50-day simple moving average (SMA) but above its 200-day SMA. While the company is experiencing short-term bearishness in the form of macro complexities, investors still think that it has potential for a long-term uptrend based on its fundamentals and growth strategies.Stretched ValuationFrom a valuation standpoint, Abbott’s forward 12-month price-to-earnings (P/E) is 24.37X, a premium to the industry average of 21.07X.The company is also trading at a significant premium to industry players like Medtronic, with its current P/E being 14.47. However, Boston Scientific, with a current P/E of 34.08X, appears more stretched.Our Take: Hold NowDespite its adaptive strategies, Abbott's stock price has not fully reflected the company’s underlying strength. The subdued market reaction to its positive first-quarter results suggests that investors remain cautious amid geopolitical uncertainty, mainly in the form of retaliating tariffs.The current stretched valuation suggests that investors may be paying a higher price relative to the company's expected earnings growth. While the impressive performance in the first quarter boosted investor sentiment, this might not be the ideal time to invest in Abbott. The short-term hiccups in the form of international trade challenges are limiting the stock’s near-term gains.Accordingly, while current shareholders should hold their positions, new investors should wait for a better entry point.Abbott currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Why Haven't You Looked at Zacks' Top Stocks?Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.Today you can access their live picks without cost or obligation.See Stocks Free >>Zacks Investment Research800-767-3771 ext. 9339support@zacks.comhttps://www.zacks.comPast performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abbott Laboratories (ABT): Free Stock Analysis Report Boston Scientific Corporation (BSX): Free Stock Analysis Report Medtronic PLC (MDT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks