Abbott Laboratories (NYSE: ABT) saw its shares decline sharply by 9.5% after Piper Sandler announced a reduction in its price target to $135 from a previous $150, though it upheld an Overweight rating on the stock in the wake of underwhelming fourth-quarter results. Currently trading near $108.61, the stock has depreciated approximately 10.8% in the past week and approaches its 52-week low of $105.78. According to InvestingPro analytics, the Relative Strength Index (RSI) suggests that Abbott's shares may be in oversold territory, signaling potential market exhaustion on the downside.
The healthcare giant reported fourth-quarter revenues of $11.46 billion, falling short of analysts’ projections of $11.8 billion, although adjusted earnings per share (EPS) reached $1.50, aligning with expectations. Piper Sandler attributed the revenue shortfall largely to difficulties within Abbott’s Nutrition business segment, which posted sales below forecasts. Despite these setbacks, Abbott maintains profitability with an annual revenue tallying $44.33 billion and a substantial market capitalization standing at $188.85 billion.
Notably, Abbott’s Medtech segment demonstrated solid performance, posting 10.4% organic growth once foreign exchange effects were excluded. However, the diabetes product line within this division underperformed relative to forecasts from both Piper Sandler and broader analyst consensus during the quarter.
Looking ahead, Abbott’s fiscal year 2026 revenue guidance came below market expectations, with the Nutrition segment solely accounting for the predicted revenue deficit according to Piper Sandler’s analysis. The company’s adjusted EPS guidance for the year matched market consensus, reflecting stability in profitability forecasts despite revenue concerns.
Despite the criticism stemming from disappointing top-line results, Piper Sandler retained its Overweight recommendation, underscoring confidence in the company’s longer-term growth potential. This bullish stance is anchored on expected new product introductions, sustained momentum in the Medtech business, and an anticipated easing of headwinds impacting Abbott’s diagnostics division. Additionally, Abbott’s track record includes a 12-year consecutive streak of dividend increases, with the current yield at an attractive 2.32%, factors which contribute to the firm's appeal among income-focused investors.
Supplementary to Piper Sandler's analysis, other financial institutions adjusted their price targets in light of Abbott’s quarterly disclosures. Oppenheimer reduced its target price to $132 from a higher figure while maintaining an Outperform rating. Wells Fargo cut its price objective to $122 while sustaining an Overweight rating, citing persistent challenges in the Nutrition segment. Raymond James also lowered its target to $130, describing fourth-quarter results as "soft," whereas Jefferies established a new target of $145 and maintained a Buy rating despite the Nutrition division’s struggles.
Overall, the mixed financial signals underscore the necessity for investors to monitor Abbott’s sector-specific performances closely, particularly in Nutrition and Medtech, as well as broader market conditions influencing the healthcare industry.