Unleashing the Power of Motley Fool: Your Ultimate Guide to Health Care Investing Success

Abbott Laboratories (NYSE: ABT) is a major player in healthcare. They operate in four key areas: medical devices, diagnostics, nutrition, and established pharmaceuticals. This variety helps them stay stable. If one sector struggles, another can help balance things out.

Right now, we see this in action. With fewer people needing COVID-19 tests, Abbott’s diagnostics division has taken a hit. However, their medical devices unit has thrived, reporting strong growth. Overall, the company saw a 5% increase in revenue this past year, reaching $10.6 billion.

Abbott is known for its top products, like Ensure in nutrition and the FreeStyle Libre glucose monitoring system in medical devices. They’re also focused on innovation, recently introducing the Lingo CGM platform aimed at health and wellness.

Currently, Abbott shares have a forward-looking price-to-earnings (P/E) ratio of 22. This is a reasonable price for a company with a solid growth history and promising future.

Ask the Fool

Q. How can I invest in socially responsible companies? – D.L., Flagstaff, Arizona

A. Look into mutual funds or exchange-traded funds (ETFs) that focus on socially responsible investing. This way, you can let professionals choose companies for you. Some funds specifically labeled with “ESG” focus on environmental, social, and governance factors.

Consider these ETFs: iShares ESG Aware MSCI USA ETF (ESGU), Vanguard ESG U.S. Stock ETF (ESGV), and Invesco ESG NASDAQ 100 ETF (QQMG). You can also invest in companies contributing positively to society or avoid those you dislike, such as those in alcohol, tobacco, or firearms.

No company is perfect, so it’s important to do some research. Websites like GreenMoney.com and CorpWatch.org provide valuable insights.

Q. Why does the stock market change value every day? – V.N., Bella Vista, Arkansas

A. The stock market reflects the buying and selling of many companies’ stocks. Each stock’s price moves based on investor reactions to news or events. Good news can drive prices up, while bad news may cause them to drop.

My smartest investment

I’m 84 years old and built my wealth through careful planning. I maximized my retirement contributions in 401(k)s and SEP IRAs, investing in no-load mutual funds. My biggest win was converting a large portion of my funds into Roth IRAs back in 1998.

My accountant suggested this after I expressed confidence that the U.S. stock market would grow over the next decade. Although it came with a hefty tax bill, my wife and I decided it was worth the investment. We lived modestly for a few years to make it work.

Now, in retirement, our main income sources are Social Security and pension funds. Our portfolio, mostly in Roth IRAs, allows us to withdraw tax-free. Those frugal years were truly worth it. – Anonymous

The Fool responds: Awesome! Roth IRAs can indeed lead to significant tax-free wealth in retirement.

Have a smart investment story to share? Reach out to us at TMFShare@fool.com.