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Healthcare Stock Skids After Earnings

Analysts and options traders were bullish ahead of Abbott earnings

Managing Editor
Oct 17, 2018 at 10:00 AM
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Shares of Abbott Laboratories (NYSE:ABT) are taking a hit in early trading, last seen down 1.7% at $69.74, following the company's third-quarter earnings report. Per-share earnings were in line with estimates, but the healthcare concern cut the top end of its adjusted full-year forecast.

From a longer-term perspective, ABT stock has been climbing, with the shares up 22% year-to-date. The stock's 50-day moving average has contained recent pullbacks, including the drop from Abbott stock's Oct. 1 record peak of $74.15. 

Ahead of earnings, options traders were leaning bullishly toward the healthcare name. This is per data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which shows ABT's 10-day call/put volume ratio of 2.62 ranking in the 72nd percentile of its annual range. This indicates that during the past two weeks of trading, calls have been purchase over puts at a faster-than-usual clip.

Lastly, analysts are also optimistic toward Abbott Laboratories stock. As of last night's close, 16 of 18 brokerage firms sported "buy" or "strong buy" recommendations. What's more, the stock's average 12-month price target stands at 10% premium to current trading levels.
 
 

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