Abbott Laboratories Economic Analysis

Abbott Laboratories Economic Analysis

Introduction

The company which is chosen for the economic and financial analysis is Abbott Laboratories. Abbott Laboratories is an American company with global operations. It belongs to the industry of Health Care and Pharmaceuticals products with its global headquarters located in North Chicago.

Market Structure

Since there are many companies in United States which belongs to the Pharmaceuticals industry the competition among the companies is tough but due to some differentiated products these companies are able to compete and survive in the industry. This market structure can be classified as Oligopoly. Here a question arises that how it is possible that despite of many companies in the industry still the competition is oligopolistic. It can be observed from the below direct competitor competition report that there are only few companies which have strong market positioning with high market share.

Direct Competitor Comparison

ABT

MRK

RHHBY

SNY

Industry

Market Cap:

$ 102.74B

$ 134.68B

$ 166.76B

$ 117.60B

$ 1.26B

Employees:

91,000

86,000

76,911

113,719

1.51K

Qtrly Rev Growth (yoy):

-0.00

-0.04

0.04

0.01

0.08

Revenue (ttm):

$ 39.41B

$ 47.82B

$ 48.16B

$ 46.89B

$ 1.67B

Gross Margin (ttm):

0.62

0.66

0.74

0.71

0.53

EBITDA (ttm):

$ 11.45B

$ 17.78B

$ 18.48B

$ 18.69B

$ 112.37M

Operating Margin (ttm):

0.22

0.23

0.33

0.25

0.12

Net Income (ttm):

$ 6.48B

$ 6.77B

$ 9.05B

$ 7.76B

N/A

EPS (ttm):

4.09

2.20

2.66

2.93

0.56

P/E (ttm):

15.90

20.14

18.51

15.25

15.93

PEG (5 yr expected):

1.42

3.71

1.88

3.09

0.92

P/S (ttm):

2.61

2.84

3.44

2.53

2.18

MRK = Merck & Co. Inc.

RHHBY = Roche Holding AG

SNY = Sanofi

Industry = Drug Manufacturers - Major

Source: http://finance.yahoo.com

Analysis of Market

Abbott Laboratories has comparatively low Income than its competitors i.e. Merck & Co. Inc., Roche Holding AG & Sanofi. The market also seems to be monopolistic due to the presence of many other companies in the industry with low market share but in actual only few companies are able to gain the major share of the market. This terms Abbott Laboratories as Oligopoly.

Total Revenue

Total revenue of Abbott Laboratories is 39.41 B which is much more than the industry average. Total revenue relates to the total sales from operations. It may include the revenue generated from the sales of equipment. ...