Abbott Laboratories reported third-quarter 2014 earnings of $0.54
per share, up 22.7% from the year-ago quarter. Abbott agreed to
sell its developed markets generics pharmaceutical business to
Mylan in Jul 2015. Hence, this business has been reported as
discontinued operations. Including the discontinued operations,
earnings came in at $0.62, up 12.7% year over year. The Zacks
Consensus Estimate was $0.60. Sales of $5.1 billion were below the
Zacks Consensus Estimate of $5.6 billion. We expect the sale of
branded generics business to positively impact the top line and
bottom line as Abbott Labs will now focus primarily on the branded
generics pharmaceuticals business in emerging markets. The improved
performance of the nutrition business should also boost investor
confidence. We maintain a Neutral recommendation.
Abbott Laboratories discovers, develops, manufactures and sells
a diversified line of healthcare products. On Jan 1, 2013, Abbott
separated its pharmaceutical business into a new company called
AbbVie. The research-based pharmaceutical company, AbbVie,
comprises proprietary pharmaceuticals and biologics.
Abbott's shareholders received one share of AbbVie common stock
on Jan 1, 2013 for every one share of Abbott common shares held as
of the close of business on Dec 12, 2012. Abbott now comprises four
businesses, namely Established Pharmaceuticals Division (EPD),
Medical Devices, Diagnostics and Nutritionals.
The Established Pharmaceuticals Division (EPD) is the company's
branded generics business. This segment generates sales outside the
US from a growing portfolio of hundreds of products. Of total EPD
sales, 60% are in emerging markets and 40% in developed
Medical Devices includes the diabetes care, vision care and
The Diagnostics segment manufactures and markets diagnostic
systems and tests, which are sold worldwide to blood banks,
hospitals, commercial laboratories and alternate-care testing
sites. The segment operates in three business lines core
laboratory, molecular and point of care.
The Nutritional Products segment includes a broad line of
pediatric and adult nutritional products, which are manufactured,
marketed and sold on a worldwide basis. Key brands are Similac,
Ensure, Pedialyte and Glucerna.
Abbott generated sales of approximately $21.8 billion in
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