Sector: Health Care | Focus: Health Care Equipment
HQ: North Chicago, Illinois
Financial Risks
Abbott faces potential legal losses from lawsuits alleging harm from infant formula products, estimated at $30-$40 million. Uncertain tax positions with the IRS, including notices of deficiency for 2019, 2017/2018, and 2020 tax years, could result in significant additional tax liabilities. The implementation of OECD Pillar 1 and 2 international tax rules may materially impact future financial statements. Impairment charges on intangible assets and investments are also potential risks.
Financial Upside
Abbott's Medical Devices and Established Pharmaceutical Products segments show sales growth, particularly in Diabetes Care, Electrophysiology, and Structural Heart. Increased pricing and gross margin improvements contribute to higher profit margins. Repurchases of common shares and dividend increases are positive signs. A new, larger yen-denominated loan provides additional financial resources.
