Abbott Laboratories manufactures and sells health care products worldwide. The company operates in four business segments: Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Vascular Products. The company was founded in 1888 and is based in Abbott Park, Illinois.
ABT Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for ABT, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Abbott Laboratories ranked in the 21th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 65.5%. The most interesting components of our discounted cash flow analysis for Abbott Laboratories ended up being:
As a business, ABT is generating more cash flow than 90.99% of positive cash flow stocks in the Healthcare.
The business' balance sheet reveals debt to be 9% of the company's capital (with equity being the remaining amount). Approximately merely 21.78% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
ABT's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 38.4% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Healthcare that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as ABT, try BAX, BIO, OFIX, REPH, and SRDX.
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