Abbott Laboratories Plummets 8%: What's Behind the Sudden Slide?

Summary
• Abbott Laboratories (ABT) shares plunged 8.04% intraday, trading at $121.15 as of 7:41 PM.
• The stock breached its 200-day moving average of $125.06 and hit a 52-week low of $119.77.
• Despite Q2 earnings and revenue beating estimates, full-year guidance remained unchanged, sparking investor frustration.
• Turnover surged to 21.97 million shares, with a 1.27% turnover rate signaling heightened short-term volatility.

Abbott Laboratories’ abrupt selloff has sent shockwaves through the medical devices sector. While the company delivered solid Q2 results—$1.26 EPS and $11.14B revenue—the decision to maintain 2025 guidance below expectations has triggered a sharp decline. The stock’s 8% drop reflects a stark disconnect between operational strength and investor sentiment, setting the stage for a critical technical and strategic analysis.

Unchanged Guidance Despite Strong Q2 Results Sparks Investor Disappointment
Abbott Laboratories’ stock price collapse stems from a fundamental mismatch between its Q2 performance and forward-looking guidance. The company reported adjusted EPS of $1.26 (beating $1.25) and revenue of $11.14B (exceeding $11.07B), with 7.5% organic sales growth and a 13.4% surge in Medical Devices segment revenue. However, investors had anticipated an upward revision to full-year adjusted EPS guidance ($5.10–$5.20), which remained stagnant despite the outperformance. This decision, coupled with the absence of new growth catalysts, triggered a bearish reaction. The market’s overcorrection—despite ABT’s historically low volatility—highlights a loss of confidence in management’s ability to capitalize on its diabetes care and cardiac device momentum.

Medical Devices Sector Mixed as Medtronic Trails Slight Decline
The broader medical devices sector remains in neutral territory, with sector leader Medtronic (MDT) down 0.37% intraday. While ABT’s drop is anomalous, MDT’s muted performance underscores a lack of sector-wide catalysts. Unlike ABT, MDT recently announced a partnership with NVIDIA to integrate AI into surgical robotics, providing a near-term upside driver. The divergence highlights ABT’s unique vulnerability to earnings guidance perception, particularly as investors weigh its diabetes care growth potential against macroeconomic headwinds in healthcare spending.

Bearish Playbook: Navigating ABT’s Technical Downtrend with Strategic Options
• 200-day average: $125.06 (below current price)
• RSI: 27.86 (oversold)
• MACD: -0.437 (bearish divergence)
• Bollinger Bands: $130.13 (lower band) as critical support

ABT’s technical profile suggests a continuation of its bearish momentum. The RSI at 27.86 indicates oversold conditions, but the MACD’s -0.437 and negative histogram signal deteriorating bullish momentum. The 200-day MA at $125.06 is now a key resistance level; a break below the lower Bollinger band ($130.13) could trigger further selling. While the 52-week low of $99.92 is distant, the immediate focus is on the 200D MA and $130.13 support.

Top Options Picks:
• ABT20250725C122:
- Type: Call
- Strike: $122
- Expiration: 2025-07-25
- IV: 19.33% (moderate)
- Leverage: 116.31%
- Delta: 0.4031 (moderate sensitivity)
- Theta: -0.22097 (high time decay)
- Gamma: 0.1054 (strong price sensitivity)
- Turnover: $121,258
- Payoff at 5% downside: $3.93 (max(ST - K, 0) = 121.15*0.95 - 122 = 115.09 - 122 = 0)
- This contract offers high leverage and gamma for aggressive short-term traders betting on a rebound above $122.

• ABT20250725C123:
- Type: Call
- Strike: $123
- Expiration: 2025-07-25
- IV: 19.34% (moderate)
- Leverage: 172.80%
- Delta: 0.3037 (moderate sensitivity)
- Theta: -0.1788 (high time decay)
- Gamma: 0.0951 (strong price sensitivity)
- Turnover: $87,056
- Payoff at 5% downside: $2.93 (115.09 - 123 = 0)
- A high-leverage call for traders expecting a bounce from oversold RSI levels.

If ABT breaks below $130.13, consider ABT20250725P115 for short-side exposure. Aggressive bulls may target a rebound above $125.06 with ABT20250725C122.

Backtest Abbott Laboratories Stock Performance
The backtest of ABT's performance after an intraday plunge of -8% shows mixed results. While the 3-day win rate is 50.69%, the 10-day win rate is 50.00% and the 30-day win rate is 48.45%, indicating a higher probability of positive returns in the short term. However, the maximum return during the backtest period was only 0.12%, suggesting that even though there was a chance of recovery, the overall performance after the plunge was muted.

Critical Juncture for ABT: Watch $130.13 Support and Guidance Clarity
Abbott Laboratories faces a pivotal technical and fundamental crossroads. While the RSI’s oversold reading may attract contrarians, the unchanged guidance and bearish MACD suggest a continuation of the downtrend. Investors should monitor the 200-day MA ($125.06) and lower Bollinger band ($130.13) as key inflection points. Medtronic’s -0.37% decline highlights sector caution, but ABT’s unique earnings narrative remains the focal point. For now, a breakdown below $130.13 or a guidance revision above $5.20 could dictate the next move. Action: Short-term traders should prioritize ABT20250725C122 for a bounce above $122, while long-term investors watch for a 52-week low test.