ABT
Abbott Laboratories
$107.32
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 36.8% above fair value
You pay
$107.32
Bear
$62.75
Fair
$78.45
Bull
$94.13
Bear
$62.75
-41.5%
$3.96 × 12x P/E
Fair
$78.45
-26.9%
$3.96 × 15x P/E
Bull
$94.13
-12.3%
$3.96 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
27.1x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $122.73 from 41 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $78.45 per share.
Warnings
Dividend-based valuation: $126.44 (above our primary estimate by 113%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $122.73 (from 41 analysts). Our estimate is 52% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples