February 15, 2009 / 5:49 PM / 11 years ago

Abbott Labs a good prescription for investors-Barrons

NEW YORK, Feb 15 (Reuters) - Shares of Abbott Laboratories Inc (ABT.N) are trading at a premium to some others in its sector but the company’s earnings power may warrant the higher valuation, according to weekly business newspaper Barron’s.

“Abbot has a broader product base than many drug companies, including a sizable medical-devices business, and it has relatively little exposure to patent expirations, the bane of Big Pharma,” said Barron’s.

At a recent price of $56 a share, the stock would be valued at more than 15 times expected earnings this year, versus about 12 for the rest of its sector.

Portfolio manager Rick Helm of the Cohen & Steers Dividend Value Fund believes there is “40 percent upside in the stock based on the growth of the company’s core businesses, lack of any significant generic competition in its key products and a pipeline that’s not sexy but has a number of promising products,” according to Barron’s.

Reporting by Lilla Zuill, editing by Martin Golan

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