July 19, 2025 a 07:46 am
ABT: Dividend Analysis - Abbott Laboratories
Abbott Laboratories showcases a strong dividend profile with an attractive yield of 2.18%. The company's commitment to a consistent dividend history over 43 years without recent cuts demonstrates its financial robustness. As a leading healthcare entity, Abbott's dividend growth rate over the past 5 years further elevates its investment appeal.
📊 Overview
Abbott Laboratories stands out within the Healthcare sector with a competitive dividend yield of 2.18%, endorsing a stable return to shareholders through dividend payments. Examining its track record, the company has diligently retained a history of 43 years of dividend payments, showcasing commendable reliability.
| Metric | Detail |
|---|---|
| Sector | Healthcare |
| Dividend yield | 2.18% |
| Current dividend per share | 2.22 USD |
| Dividend history | 43 years |
| Last cut or suspension | None |
🗣️ Dividend History
Abbott's continued commitment to progressive dividends is depicted through its consistent payment schedule and incremental growth. This approach not only fortifies investor trust but also signals strong management efficiency in capital distribution.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 1.77 |
| 2024 | 2.20 |
| 2023 | 2.04 |
| 2022 | 1.88 |
| 2021 | 1.80 |
📈 Dividend Growth
Analyzing Abbott's dividend growth highlights its commitment to enhancing shareholder value. The growth rates over the past three and five years reflect a disciplined focus on boosting dividend payouts steadily.
| Time | Growth |
|---|---|
| 3 years | 6.92% |
| 5 years | 11.44% |
The average dividend growth is 11.44% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio
Evaluating Abbott's payout ratios provides insight into the sustainability of its dividend payments, with a notably healthy EPS-based payout of 27.54% and an FCF-based ratio at 57.89%.
| Key figure | Ratio |
|---|---|
| EPS-based | 27.54% |
| Free cash flow-based | 57.89% |
The EPS-based payout ratio suggests robust earnings coverage, while the FCF ratio reflects proficient cash flow management, indicative of sound financial policies.
✅ Cashflow & Capital Efficiency
Abbott's cashflow efficiency remains hallmark to its operational strength. The free cash flow yield paired with capital efficiency metrics underlines a resilient financial structure.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 3.24% | 2.65% | 4.05% |
| Earnings Yield | 6.84% | 3.00% | 3.60% |
| CAPEX to Operating Cash Flow | 25.79% | 30.32% | 18.55% |
| Stock-based Compensation to Revenue | 1.60% | 1.61% | 1.57% |
| Free Cash Flow/Operating Cash Flow Ratio | 74.21% | 69.67% | 81.45% |
Abbott's cash flow practices suggest robust operational management, supporting its substantial dividend payouts and capital reinvestment strategies.
⚠️ Balance Sheet & Leverage Analysis
Abbott's balance sheet stability and leverage metrics affirm its low-risk profile. Efficient debt management and liquidity ratios underscore its financial flexibility.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 31.51% | 41.12% | 48.29% |
| Debt-to-Assets | 18.45% | 21.68% | 23.80% |
| Debt-to-Capital | 23.96% | 29.14% | 32.56% |
| Net Debt to EBITDA | 0.63 | 0.85 | 0.65 |
| Current Ratio | 1.67 | 1.64 | 1.63 |
| Quick Ratio | 1.23 | 1.16 | 1.23 |
| Financial Leverage | 1.71 | 1.90 | 2.03 |
Analysis reflects a well-structured balance sheet with conservative leverage figures, reinforcing Abbott's capacity for sustainable financial operations.
Profitability & Fundamental Strength
Abbott showcases substantial profitability metrics, reflecting effective cost management and strategic capital allocation. Returns remain consistently high across key profitability ratios.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 28.12% | 14.83% | 18.90% |
| Return on Assets | 16.46% | 7.82% | 9.31% |
| Net Margin | 31.95% | 14.27% | 15.88% |
| EBIT Margin | 18.05% | 18.20% | 20.31% |
| EBITDA Margin | 25.83% | 26.29% | 27.79% |
| Gross Margin | 55.41% | 55.18% | 56.15% |
| R&D to Revenue | 6.78% | 6.83% | 6.62% |
Abbott's profitability metrics underline a robust earnings power, indicating strategic expertise in navigating market complexities while ensuring shareholder value through consistent margins.
Price Development
Dividend Scoring System
| Category | Score | |
|---|---|---|
| Dividend yield | 4 | |
| Dividend Stability | 5 | |
| Dividend growth | 4 | |
| Payout ratio | 5 | |
| Financial stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 5 |
Total Score: 36/40
Rating
Given Abbott Laboratories' consistent and robust dividend growth, paired with its solid balance sheet and financial resilience, the company earns a high recommendation for income-focused investors. The stability and growth evident in its dividend profile make it an attractive choice for those seeking a reliable, long-term investment.