Many investors are wondering what’s going on with ABT and why it dropped some much in price recently. Some wondered whether the failed kidney drug test was the reason, or was it sales and earnings although it met expectations, or decreased revenue? I do not know, but honestly, I do not care that much.
What I care however is this. The company is a dividend payer. How the current situation affects the dividends?
If you take a look at JNJ which undergone serious issues last year with recalls, the company was able to sustain it, it didn’t decrease the dividend and it survived because of the strength of the company, its size and a whole range of products it manufactures.
Thus I believe Abbott is in the same range of companies. It’s been raising dividends for consecutive 39 years, the dividend growth is 9.63% annually and dividend yield is now 3%. It’s PEG ratio 1.89 is in line with industry median of 1.69, P/E of 16.203 is in line with industry median of 18.71 and thus the company is fairly valued. As a dividend achiever, to me, this stock is a buy.
Last Friday I used scaling in tactics to buy more shares of ABT. My buy price for Monday would be only if it reaches $66.9 with stop limit at $67.8.
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