Abbott Laboratories (ABT) Stock Valuation — PE Analysis
Medical - Devices · NYSE
Current Price
$103.49
PE Ratio (TTM)
38.3x
Intrinsic Value
$114.76
+9.8% margin of safety
COMPETITIVE MOAT
↑Diversified Product Portfolio
Abbott's broad range of medical devices, diagnostics, nutritionals, and branded generic pharmaceuticals creates resilience. This diversification reduces reliance on any single product category.
↑Strong Brand Recognition & Trust
Decades of established presence have built significant trust with healthcare professionals and consumers. This brand equity translates into preferred adoption of its products.
↑Extensive Distribution Network
A well-established global sales and distribution infrastructure ensures broad market access. This network is difficult and costly for competitors to replicate.
INVESTMENT RISKS
↓Product Recall and Safety Concerns
Any significant product recall or safety issue could severely damage reputation and lead to substantial financial penalties. This is a constant threat in the medical device industry.
↓Healthcare Policy and Reimbursement Changes
Shifts in government healthcare policies or changes in reimbursement rates can impact demand and profitability for Abbott's products. This creates market uncertainty.
↓Innovation Pace and Technological Obsolescence
The rapid pace of technological advancement requires continuous R&D investment. Failure to innovate or adapt to new technologies could lead to market share erosion.
Base case
ABT base case PE valuation
At a current price of $103.49, the base case PE valuation puts ABT fair value near $114.76 per share. That figure assumes 9.5% yearly earnings growth, a target PE multiple of 38.19x, and a 10% discount rate.
Intrinsic Value
$114.76
Margin of safety
+9.8%
Expected annual return
+2.1%
Base case assumptions: 9.5% annual earnings growth, 38.19x target PE, 10% discount rate, 5 year projection. Data as of 2026-10-28.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the ABT PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Abbott Laboratories respond.
Open PE Calculator for ABTCompany Overview
Abbott Laboratories, along with its affiliated entities, is a global healthcare enterprise dedicated to the research, development, manufacturing, and worldwide distribution of a diverse portfolio of health solutions. The company operates through four primary divisions: Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Medical Devices. In the Established Pharmaceutical Products segment, Abbott provides generic medications designed to treat a wide array of conditions, including pancreatic exocrine insufficiency, irritable bowel syndrome or biliary spasm, intrahepatic cholestasis or depressive symptoms, gynecological disorders, hormone replacement therapy, dyslipidemia, hypertension, hypothyroidism, Ménière's disease and vestibular vertigo, pain, fever, inflammation, and migraine. This segment also supplies the anti-infective clarithromycin, influenza vaccines, and products aimed at regulating colon physiology. The Diagnostic Products division offers a comprehensive suite of diagnostic tools. These include laboratory systems for immunoassay, clinical chemistry, hematology, and transfusion; molecular diagnostics systems that automate the extraction, purification, and preparation of DNA and RNA from patient samples, as well as detect and quantify infectious agents. Additionally, this segment provides point-of-care systems, blood testing cartridges, rapid lateral flow testing products, and specialized molecular point-of-care tests for pathogens such as HIV, SARS-CoV-2, influenza A and B, RSV, and strep A. Its offerings also extend to cardiometabolic test systems, drug and alcohol screening solutions, remote patient monitoring, consumer self-test systems, and sophisticated informatics and automation solutions for laboratory use. The Nutritional Products segment is responsible for delivering nutritional formulations tailored for both pediatric and adult populations. Finally, the Medical Devices segment develops and commercializes rhythm management, electrophysiology, heart failure, vascular, and structural heart devices for the treatment of cardiovascular ailments. It also supplies diabetes care products and neuromodulation devices designed for the management of chronic pain and movement disorders. Founded in 1888, Abbott Laboratories maintains its corporate headquarters in North Chicago, Illinois.
Financial Metrics — ABT PE Stock Valuation Data
PE Ratio (TTM)
38.3x
PEG Ratio
n/m
Earnings Yield
2.62%
ROE (TTM)
9.1%
Revenue/Share (TTM)
$27.75
Dividend Yield
2.44%
Debt/Equity
0.64x
Frequently Asked Questions
What is the PE ratio of ABT?
The trailing twelve-month PE ratio of ABT reflects how much investors pay per dollar of Abbott Laboratories's earnings. This metric is most useful when compared to Medical - Devices peers and the company's own historical range.
Is ABT overvalued based on PE ratio?
ABT's PE of 38.3x combined with a PEG ratio of -0.58 provides a growth-adjusted perspective. ABT has negative earnings, so its PE and PEG ratios are not meaningful here and cannot tell you whether the stock is over or undervalued. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Medical - Devices, a DCF analysis may be more appropriate.
How do I value ABT stock using PE ratio?
To value Abbott Laboratories using PE: (1) Compare the current PE (38.3x) against the Medical - Devices median to assess relative pricing, (2) check the PEG ratio (-0.58) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of ABT?
ABT's PEG ratio is -0.58, calculated by dividing the PE ratio (38.3x) by the expected earnings growth rate. Because ABT has negative earnings, its PEG ratio is not meaningful and should not be read as a sign of under or overvaluation. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for ABT stock valuation?
PE ratio gives a quick relative read — how ABT is priced versus Medical - Devices peers. DCF provides an absolute value based on projected free cash flows. For the most reliable valuation, use PE as a quick comparability screen and DCF for a deeper fundamental analysis. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See ABT DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Healthcare valuationsP/E and DCF value ABT with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-10-28. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.