Abbott Laboratories Stock Hands $28 Bil Back – Worth a Look?
In the last five years, Abbott Laboratories (ABT) stock has returned $28 Bil back to its shareholders through cold, hard cash via dividends and buybacks. Let’s look at some numbers and compare how this payout power stacks up against the market’s biggest capital-return machines.
As it turns out, ABT stock has returned the 66th highest amount to shareholders in history.
| ABT | S&P Median | |
|---|---|---|
| Dividends | $18 Bil | $3.0 Bil |
| Share Repurchase | $9.5 Bil | $3.0 Bil |
| Total Returned | $28 Bil | $6.0 Bil |
| Total Returned as % of Current Market Cap | 16.5% | 16.4% |
Why should you care? Because dividends and share repurchases represent direct, tangible returns of capital to shareholders. They also signal management’s confidence in the company’s financial health and ability to generate sustainable cash flows. And there are more stocks like that. Here is a list of the top 10 companies ranked by total capital returned to shareholders via dividends and stock repurchases.
Top 10 Stocks By Total Shareholder Return
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- Pay Less, Gain More: STE, RMD Top Abbott Laboratories Stock
| Total Money Returned | As % Of Current Market Cap | via Dividends | via Share Repurchases | |
|---|---|---|---|---|
| AAPL | $514 Bil | 12.8% | $75 Bil | $439 Bil |
| GOOGL | $296 Bil | 7.3% | $17 Bil | $279 Bil |
| MSFT | $223 Bil | 7.2% | $105 Bil | $118 Bil |
| JPM | $176 Bil | 20.3% | $71 Bil | $105 Bil |
| META | $159 Bil | 9.4% | $10 Bil | $149 Bil |
| XOM | $152 Bil | 24.2% | $79 Bil | $73 Bil |
| BAC | $125 Bil | 31.4% | $45 Bil | $80 Bil |
| CVX | $112 Bil | 30.7% | $57 Bil | $55 Bil |
| WFC | $105 Bil | 41.0% | $22 Bil | $83 Bil |
| NVDA | $96 Bil | 2.0% | $3.0 Bil | $93 Bil |
For full ranking, visit Buybacks & Dividends Ranking
What do you notice here? The total capital returned to shareholders as a % of the current market cap appears inversely proportional to growth prospects for reinvestments. Stocks like Meta (META) and Microsoft (MSFT) are growing much faster, in a more predictable way, compared to the others, but they have returned a much lower fraction of their market cap to shareholders.
That’s the flip side to high capital returns. Sure, they are attractive, but you have to ask yourself the question: Am I sacrificing growth and sound fundamentals? With that in mind, let’s look at some numbers for ABT. (see Buy or Sell Abbott Laboratories Stock for more details)
Abbott Laboratories Fundamentals
- Revenue Growth: 5.7% LTM and 0.7% last 3-year average.
- Cash Generation: Nearly 16.7% free cash flow margin and 18.2% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for ABT was -8.1%.
- Valuation: Abbott Laboratories stock trades at a P/E multiple of 25.6
| ABT | S&P Median | |
|---|---|---|
| Sector | Health Care | – |
| Industry | Health Care Equipment | – |
| PE Ratio | 25.6 | 24.4 |
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| LTM* Revenue Growth | 5.7% | 6.8% |
| 3Y Average Annual Revenue Growth | 0.7% | 5.5% |
| Min Annual Revenue Growth Last 3Y | -8.1% | 0.4% |
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| LTM* Operating Margin | 18.2% | 18.6% |
| 3Y Average Operating Margin | 16.9% | 18.1% |
| LTM* Free Cash Flow Margin | 16.7% | 14.2% |
*LTM: Last Twelve Months
The table gives a good overview of what you get from ABT stock, but what about the risk?
ABT Historical Risk
Abbott isn’t immune to big drops. It fell 44% in the Dot-Com bust, nearly 29% during the Global Financial Crisis, and about 34% in the inflation shock. The Covid selloff and 2018 correction weren’t as severe but still pulled it down by 32% and 12% respectively. Solid company, sure, but when the market turns sour, even steady stocks like Abbott can take a sizable hit.
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