Is ABT a Buy? What to Consider in 2026
Short answer
The bull case for Abbott Laboratories (ABT) rests on FreeStyle Libre: A Platform, Not Just a Product: FreeStyle Libre exceeded $7.5 billion in 2025 annual sales and grew roughly 19-20% organically in H1 2025, making it the dominant revenue engine within Medical Devices. Revenue (TTM) is ~$45.1 billion. If you believe that thesis holds, the real questions become position sizing and overlap, not timing. The main risk to that view: The most acute near-term risk is infant formula litigation: juries have delivered verdicts including a $53 million compensatory award in late March 2026 and a separately upheld $495 million verdict, with hundreds of additional NEC-related cases still pending, and a securities class action filed in 2026 adds a parallel legal exposure track targeting alleged investor misstatements. Whether ABT is a buy comes down to whether you believe the thesis. This is informational, not a recommendation, and Walnut is not an investment adviser.
Abbott Laboratories is a global healthcare company headquartered in North Chicago, Illinois, that discovers, develops, manufactures, and sells health care products in more than 160 countries through four segments: Medical Devices, Diagnostic Products, Nutritional Products, and Established Pharmaceutical Products. Medical Devices, the largest segment at roughly $21.4 billion in 2025 revenue, includes the FreeStyle Libre family of continuous glucose monitors, structural heart products (Navitor, TriClip), electrophysiology systems (AVEIR leadless pacemaker), vascular devices, and heart-failure technologies. Diagnostics contributes roughly $8.9 billion, Nutrition roughly $8.5 billion (anchored by Similac infant formula and Ensure adult nutrition), and Established Pharmaceuticals roughly $5.5 billion in branded generics sold primarily in emerging markets. Founded in 1888 by Dr. Wallace Calvin Abbott in Chicago, the company has spent more than a century reshaping itself through major transactions, including the 2017 acquisitions of Alere and St. Jude Medical that built its current devices leadership, the 2020 COVID-19 rapid-test windfall that swelled its diagnostics footprint, and the approximately $21 billion acquisition of Exact Sciences completed in early 2026 to expand into cancer diagnostics. Robert Ford, a company veteran, has served as chairman and chief executive officer since 2020 and has presided over the post-COVID pivot back to organic device and diagnostics growth. Abbott employs roughly 114,000 colleagues worldwide and is a member of the S&P 500 Dividend Aristocrats Index, having raised its annual dividend for more than 53 consecutive years.
What's the case for buying ABT?
FreeStyle Libre: A Platform, Not Just a Product
FreeStyle Libre exceeded $7.5 billion in 2025 annual sales and grew roughly 19-20% organically in H1 2025, making it the dominant revenue engine within Medical Devices. The platform is expanding into over-the-counter wellness use cases via Lingo and Libre Rio, broadening the addressable market well beyond Type 1 and Type 2 diabetes management. Abbott recently secured a CE Mark for the world's first dual glucose-ketone sensing technology, pointing to further clinical differentiation.
Cardiovascular and Electrophysiology Momentum
The cardiovascular and electrophysiology portfolio, including Navitor, TriClip, Amplatzer Amulet, and the AVEIR leadless pacemaker, delivered double-digit organic growth in H1 2025, with structural heart growing roughly 13% organically. Recent FDA approvals broaden the addressable patient population and position Abbott to close the gap on category leaders Medtronic and Boston Scientific. The division benefits from durable procedure-volume tailwinds driven by an aging global population.
Cancer Diagnostics Expansion via Exact Sciences
The approximately $21 billion acquisition of Exact Sciences, closed in early 2026, adds the Cologuard non-invasive colorectal cancer screening test and a liquid biopsy pipeline to Abbott's diagnostics portfolio, addressing a roughly $60 billion oncology diagnostics market opportunity. Combined with Abbott's existing Alinity laboratory platform and global commercial infrastructure, the deal is designed to accelerate multi-cancer early detection capabilities. Management has guided for full-year 2026 comparable sales growth of 6.5-7.5%, including contributions from Exact Sciences.
Dividend Durability and Capital Return
Abbott has raised its dividend for more than 53 consecutive years, with the quarterly payment increased to $0.63 per share in January 2026, representing a 6.8% increase from the prior rate and implying an annualized payout of $2.52 per share. Free cash flow consistently covers dividends with a payout ratio near 60-67%, leaving capacity for buybacks and tuck-in M&A. The company's Altman Z-Score places it firmly in the low-bankruptcy-risk zone, and its balance sheet has supported large acquisitions while maintaining a manageable debt-to-EBITDA profile.
What are the risks to ABT?
The most acute near-term risk is infant formula litigation: juries have delivered verdicts including a $53 million compensatory award in late March 2026 and a separately upheld $495 million verdict, with hundreds of additional NEC-related cases still pending, and a securities class action filed in 2026 adds a parallel legal exposure track targeting alleged investor misstatements. Integration of the approximately $21 billion Exact Sciences acquisition introduces execution risk, short-term EPS dilution, and elevated SGA costs that compressed Q1 2026 operating earnings year over year. Foreign exchange headwinds have consistently shaved 2-3 percentage points off reported international revenue growth, and any meaningful dollar strengthening would pressure reported results disproportionately given Abbott's broad non-US exposure. Competitive disruption in continuous glucose monitoring from DexCom and emerging players, along with pricing pressure from government payers and the Inflation Reduction Act, represent structural long-term headwinds.
How is ABT valued? (as of 2026-06-27 (TTM through Q1 2026; share price data as of June 26, 2026))
- Revenue (TTM): ~$45.1 billion
- Revenue (FY 2025): ~$44.3 billion (+5.7% YoY)
- Net Income (FY 2025): ~$6.5 billion
- Net Profit Margin (FY 2025): ~14.7%
- Adjusted EPS Guidance (FY 2026): ~$5.38 to $5.58
- P/E Ratio (TTM, trailing GAAP): ~26x (approximately 26% below 10-year median of ~36x)
- Dividend (Annualized): $2.52 per share (~2.7% yield at recent prices)
- EBITDA (FY 2025): ~$11.2 billion
ABT's trailing GAAP P/E of roughly 26x sits below its own 3-year, 5-year, and 10-year historical averages, and is modestly above the Medical Devices and Instruments industry median of roughly 25x, suggesting the market has re-rated the stock from COVID-era growth-premium levels while still assigning a quality multiple. Revenue growth has remained consistently positive in the 5-7% range even as GAAP EPS was pressured in FY2025 by a year-over-year comparison that included elevated one-time items. The FY2026 adjusted EPS guidance of $5.38-$5.58 implies a forward adjusted P/E in the high-teens to low-twenties range at recent share prices, which analysts broadly describe as modestly discounted relative to fundamental fair value estimates.
How do you decide if ABT is a buy?
Rather than asking whether ABT is a buy in the abstract, it tends to help to answer four questions:
- Thesis: do you believe the case above, and is it still true today?
- Time horizon: a single stock can be volatile, so a longer horizon absorbs more of the swings.
- Position sizing: a thesis can be right and the sizing still wrong; decide how much of your portfolio one name should be.
- Overlap: check whether you already hold ABT indirectly through an index or sector ETF before adding more.
For the full picture, see the ABT stock guide (what the company does, the ETFs that hold it, similar stocks, and the themes it fits). In Walnut you can ask its AI about ABT against your real portfolio and see your actual exposure before deciding.
The bottom line on ABT
The bottom line: Abbott Laboratories's story right now is FreeStyle Libre: A Platform, Not Just a Product, with revenue (ttm) at ~$45.1 billion. If you believe that narrative continues, the call is about sizing ABT sensibly and checking overlap with what you own; if you doubt it (the risk: the most acute near-term risk is infant formula litigation: juries have delivered verdicts including a $53 million compensatory award in late March 2026 and a separately upheld $495 million verdict, with hundreds of additional NEC-related cases still pending, and a securities class action filed in 2026 adds a parallel legal exposure track targeting alleged investor misstatements.), it is not for you. Decide from the thesis, not the ticker. Walnut is not an investment adviser.
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FAQ
Is ABT a good stock to buy right now?
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The case for Abbott Laboratories right now is FreeStyle Libre: A Platform, Not Just a Product, with revenue (ttm) at ~$45.1 billion. If you believe that thesis holds, ABT is a way to own it and the real questions are sizing and overlap, not timing; the main risk to that view is the most acute near-term risk is infant formula litigation: juries have delivered verdicts including a $53 million compensatory award in late March 2026 and a separately upheld $495 million verdict, with hundreds of additional NEC-related cases still pending, and a securities class action filed in 2026 adds a parallel legal exposure track targeting alleged investor misstatements. So it comes down to whether you believe the thesis. Walnut is not an investment adviser and this is not a recommendation.
What does Abbott Laboratories do?
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Abbott Laboratories is a global healthcare company headquartered in North Chicago, Illinois, that discovers, develops, manufactures, and sells health care products in more than 160
What are the main risks of ABT?
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The most acute near-term risk is infant formula litigation: juries have delivered verdicts including a $53 million compensatory award in late March 2026 and a separately upheld $495 million verdict, with hundreds of additional NEC-related cases still pending, and a securities class action filed in 2026 adds a parallel legal exposure track targeting alleged investor misstatements. Integration of the approximately $21 billion Exact Sciences acquisition introduces execution risk, short-term EPS dilution, and elevated SGA costs that compressed Q1 2026 operating earnings year over year. Foreign exchange headwinds have consistently shaved 2-3 percentage points off reported international revenue growth, and any meaningful dollar strengthening would pressure reported results disproportionately given Abbott's broad non-US exposure. Competitive disruption in continuous glucose monitoring from DexCom and emerging players, along with pricing pressure from government payers and the Inflation Reduction Act, represent structural long-term headwinds.
What does Abbott Laboratories do?
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Abbott is a global healthcare company operating in four segments: Medical Devices (largest, led by the FreeStyle Libre glucose monitor and cardiovascular products), Diagnostics (laboratory and point-of-care tests), Nutrition (Similac infant formula, Ensure adult nutrition), and Established Pharmaceuticals (branded generics in emerging markets). It serves patients in more than 160 countries and employs roughly 114,000 people worldwide.
Is ABT a good stock to invest in right now?
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That depends on your investment horizon and risk tolerance. ABT's Medical Devices segment is growing at double-digit organic rates, and the stock's trailing P/E of roughly 26x sits below its own historical averages. However, ongoing infant formula litigation with verdicts in the hundreds of millions, Exact Sciences integration complexity, and near-term EPS pressure are real uncertainties. Investors weigh these factors differently based on their goals.
Does ABT pay a dividend?
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Yes. Abbott has raised its dividend for more than 53 consecutive years, qualifying it as a Dividend King. The current quarterly dividend is $0.63 per share (annualized $2.52), representing a yield of roughly 2.7% at recent share prices. The payout ratio is approximately 60-67% of free cash flow, which analysts generally view as well-covered and sustainable given Abbott's cash generation profile.
Who are Abbott Laboratories's main competitors?
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ABT faces segment-specific rivals: DexCom in continuous glucose monitoring; Medtronic and Boston Scientific in cardiovascular and electrophysiology devices; Roche, Siemens Healthineers, and Danaher in laboratory diagnostics; and Nestle and Reckitt Benckiser (Mead Johnson) in infant formula and adult nutrition. No single company competes across all four of Abbott's segments simultaneously, which is part of its diversification argument.
Walnut is informational and is not an investment adviser. This page is educational and not a recommendation to buy or sell ABT; figures are approximate and dated, and your own situation, time horizon, and risk tolerance should drive any decision. Verify current data before investing.