Abbott Laboratories fell just short of Wall Street estimates for quarterly revenue on Wednesday, as weakness in the medical device maker's cardiovascular business overshadowed strong performance in its fast-growing diabetes care unit.
Shares of the company, which also trimmed its full-year profit forecast, flitted between gains and losses. They were last up about 1.7%, after having risen about 13% to Tuesday's close.
"In this environment, investors are nervous. Any room for uncertainty, people react first and ask questions later. Post call ... I think people are comfortable with the growth algorithm here," said Evercore ISI analyst Vijay Kumar.
A 63% jump in sales of FreeStyle Libre continuous glucose monitor powered the diabetes unit's better-than-expected revenue of $665 million. Two analysts polled by Refinitiv had expected $645 million.
The device helps diabetics track blood sugar levels without having to prick their fingers, and the company is awaiting the Food and Drug Administration's approval for the next-generation version of the device, the Freestyle Libre 2.0.
However, a lack of updates on the approval also left investors skittish.
"Admittedly, it's taking longer than we had expected. We obviously misjudged that," Chief Operating Officer Robert Ford said on a conference call with analysts, but did not provide a timeline for the approval.
The cardiovascular business, the company's biggest that houses the MitraClip, posted sales of $2.40 billion, below estimates of $2.44 billion, according to two analysts polled by Refinitiv.
Sales of MitraClip, seen as another growth driver, jumped 30% to $176 million. The device is used to repair leaky heart valves and the company has notched up approvals for new versions and additional indications.
Abbott narrowed its 2019 adjusted earnings per share forecast to a range of $3.23 to $3.25, from a prior expectation of $3.21 to $3.27.
Net earnings rose to $960 million, or 53 cents per share, in the third quarter ended Sept. 30, from $563 million, or 32 cents per share, a year earlier.
Excluding items, the company earned 84 cents per share, matching analysts' average estimate.
Net sales rose 5.5% to $8.08 billion, just shy of the average analyst estimate of $8.10 billion.
Abbott bought Little Canada-based St. Jude Medical in 2017 and maintains a significant Twin Cities presence.