Abbott Laboratories (ABT) Stock Analysis

Abbott Laboratories’ primary competitive advantage is its diversified business model spanning medical devices, diagnostics, nutritionals, and branded generics. This breadth reduces reliance on any single product or market, enabling resilience to sector-specific downturns. For example, in 2024, no individual segment accounted for more than 45% of total sales, and international markets represented 61% of revenue, mitigating regional risk.

Abbott’s scale and global reach are difficult to replicate. Its FreeStyle Libre continuous glucose monitoring system is a market leader, with diabetes care sales reaching $6.4 billion in 2024—outpacing Medtronic and challenging Dexcom. In diagnostics, Abbott’s Alinity platform and rapid test portfolio provide recurring revenue and high customer switching costs due to integration with hospital workflows. The company’s nutritionals business, led by brands like Ensure and Similac, benefits from strong consumer loyalty and broad distribution, though it faces competition from Nestlé and Danone.

Abbott’s R&D investment—targeted at roughly 7% of sales—supports a robust pipeline, evidenced by recent FDA approvals in structural heart and diabetes care. Its long history of dividend growth (53 consecutive years) and strong investment-grade credit ratings (AA-/Aa3) reinforce financial stability.

Risks include exposure to pricing pressure, regulatory changes, and supply chain disruptions. However, Abbott’s diversified portfolio, global infrastructure, and brand strength provide a durable edge over less diversified peers such as Dexcom, Hologic, and Baxter.