Jim Cramer just bought Abbott stock: should you too?
- Jim Cramer bought 275 shares of Abbott Laboratories on Monday.
- The famed investor sees several catalysts for the healthcare giant.
- Abbott stock has already gained about 25% since mid-October.
A near 2.0% post-earnings decline in Abbott Laboratories (NYSE: ABT) warrants an investment in the health care giant, says Jim Cramer.
Cramer’s bullish view on Abbott stock
Copy link to sectionHis Charitable Trust bought 275 shares of the medical devices company at $112 each on Monday.
Cramer is confident that the weight-loss drugs are not a threat for this Chicago-based maker of FreeStyle Libre (continuous glucose monitoring system).
The Mad Money host is bullish on Abbott stock also for the nutrition business that its management believes will grow 6.0% this year. The New York listed firm reported better-than-expected revenue for its fourth financial quarter last week as Invezz reported here.
$ABT is all the more attractive considering it pays a dividend yield of 1.94% as well, as per Jim Cramer.
Abbott stock deserves a premium multiple
Copy link to sectionNote that Abbott Laboratories has plans of launching a nutritional supplement that would help restrict muscle loss related to the use of weight-loss drugs.
JPMorgan estimates about 30 million people in the U.S. to be on GLP-1 by the end of this decade – which means millions of people could be consuming Abbott’s drink by 2030.
$ABT now forecasts between $4.50 to $4.70 of adjusted EPS in its fiscal 2024. Analysts, in comparison, were at $4.63. But Jim Cramer reminded followers of his Charitable Trust today that this leader in medical devices and healthcare solutions has a history of being conservative with guidance.
All in all, the famed investor is convinced that Abbott stock deserves to trade at a premium to its historical average.
