Abbott Laboratories (NYSE:ABT) has provided a 2024 profit forecast that falls largely below Wall Street estimates, leading to a 2.5% decline in the medical device maker’s shares in premarket trading. While Abbott Laboratories met quarterly earnings expectations, its outlook for 2024 has raised concerns among investors.
Expectations for the performance of medical device makers have been on the rise, particularly after health insurers signaled higher medical costs due to people, especially older adults, resuming delayed medical procedures. Abbott’s forecast comes on the heels of strong earnings from peers like Johnson & Johnson (NYSE:JNJ) and Intuitive Surgical (NASDAQ:ISRG), both of which anticipate sustained demand for medtech-related procedures in 2024.
Mizuho Securities analyst Anthony Petrone noted that, at first glance, Abbott’s profit forecast appears “a touch light” compared to Wall Street expectations. The medical devices unit’s sales for the fourth quarter reached $4.44 billion, surpassing estimates of $4.33 billion. The strong performance was attributed to electrophysiology products, although competition may arise later in the year. The glucose monitoring device FreeStyle Libre also contributed significantly, generating $1.4 billion in sales, up 25.5% year-on-year.
Abbott is banking on the continued growth of FreeStyle Libre, aiming for annual sales of $10 billion by 2028. However, its diagnostic segment, which experienced a surge during the pandemic, recorded sales of $2.5 billion, in line with estimates but down 22.7% due to a sharp decline in COVID-19 testing-related sales.
The company reported COVID testing sales of $288 million but did not provide an annual outlook. For 2024, Abbott forecasts adjusted profit in the range of $4.50 to $4.70 per share, with the mid-point falling below analysts’ estimates of $4.64 per share. Despite the cautious outlook, the company’s quarterly profit, excluding items, aligned with the average analyst estimate of $1.19 per share.
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Author Faith Yakubu 
