) is scheduled to report fourth quarter 2013 results before the
opening bell on Jan 22, 2014.
Last quarter, Abbott Labs posted a 7.84% positive surprise. On
an average, Abbott Labs has posted a 4.57% positive surprise in
the last four quarters. Let's see how things are shaping up for
the fourth quarter.
Factors to Influence 4Q Results
Abbott Labs is an extremely diversified company with its
presence in the diagnostics, nutrition, generics and medical
devices markets after having separated its pharmaceutical
business into a new company called
) in Jan 2013.
However, the business environment was challenging in 2013 due
to austerity measures in developed markets and weak economic
conditions in developing markets. We believe the pricing pressure
in the EU and health care reforms in the U.S. will have a
negative impact on sales.
Moreover, we were disappointed by the disruption in
international nutrition sales in the third quarter of 2013. The
disruption is likely to stretch into the first half of 2014. The
nutrition division is the company's fastest growing business and
hence a disruption in business will impact growth rates going
forward. China is a key emerging market for Abbott Labs and the
disruption is expected to negatively impact the bottom line by
approximately 5 cents.
However, our proven model does not conclusively show that
Abbott Labs will beat earnings this quarter. That is because a
stock needs to have both a positive
and a Zacks Rank #1, #2 or #3 to be able to beat consensus
estimates. That is not the case here as you will see below.
The ESP, which represents the difference between the Most
Accurate estimate and the Zacks Consensus Estimate, is 0.00%.
This is because both the Most Accurate Estimate and Zacks
Consensus Estimate currently stand at 58 cents.
Zacks Rank #3
Abbott Labs' Zacks Rank #3 (Hold) when combined with a 0.00% ESP
makes surprise prediction difficult.
We caution against stocks with Zacks Ranks #4 and #5
(Sell-rated stocks) going into the earnings announcement,
especially when the company is seeing negative estimate
Stocks to Consider
Here are some large cap pharma stocks you may want to consider as
our model shows that these have the right combination of elements
to post an earnings beat this season:
Eli Lilly and Company
) has Earnings ESP of +1.37% and holds a Zacks Rank #3. Eli Lilly
will be reporting fourth quarter 2013 earnings on Jan 30, 2014.
) has earnings ESP of +2.27% and holds a Zacks Rank #3. Sanofi
will report fourth quarter 2013 results on Feb 6, 2014.
ABBVIE INC (ABBV): Free Stock Analysis Report
ABBOTT LABS (ABT): Free Stock Analysis Report
LILLY ELI & CO (LLY): Free Stock Analysis
SANOFI-AVENTIS (SNY): Free Stock Analysis
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