Amidst our exhaustive coverage of the Abbott (ABT)/AbbVie (ABBV) separation, there has been no consensus as to which company is the ‘better’ one to own. Some people like AbbVie’s higher dividend yield while others prefer Abbott’s growth prospects. Ahhh what is an uninformed investor to do? Luckily, the self-appointed people’s champion stockpicker, CNBC’s Jim Cramer, has weighed in with his opinion and his choice is…Abbott!
While normally Mr. Cramer said he prefers the spinoff (Abbvie), he is not interested in this case because ‘it has nothing big in the pipeline that would fuel much growth down the road.’ In fact, in his opinion, the whole point of the spin was to shed the no-growth pharma business…so why would he then want to own it?
On the other hand, Abbott ‘is in an excellent position to grow revenues far faster than its peers’ due to its strong presence in fast growing sectors and the emerging markets. Another reason Cramer loves Abbott is that he is a huge fan of CEO Miles White. Mr. Cramer believes that Mr. White is ’one of the best execs in the healthcare industry.’
Bottom line according to Cramer: “Stick with Abbott Labs.” Q.E.D.?
Disclosure: Author holds no position in any stock mentioned