AbbVie (ABBV): Will The Stock Recover?

3:28 pm ET, 22 Mar 2018

AbbVie (NYSE: ABBV) diverted the Rova-T program today—and that led to its stock price fall by 13%. 

The program’s objective was to obtain a quick approval for the treatment of third-line refractory small cell lung cancer. 

In 2016, AbbVie pursued an expensive deal to acquire a biotech unicorn Stemcentrx for $5.8 Billion. It had bet on its lead product named Rova-T, which was targeted to approach the proteins that are found in tissues of people who have lung cancer.

After consultation with the FDA, AbbVie won’t try for accelerated approval of Rova-T in one type of small cell lung cancer This step has created a wave of disappointment among its investors.

What do the analysts say about ABBV? Per Finstead Research, ABBV’s average price target is almost $128.


The valuation of ABBV stock is relatively low compared to its peers. Only GILDPFE and BIIB are valued below ABBV based on the forward P/E ratio.


If you're a trader contemplating buying ABBV, there may be a point when the stock will bounce back. 

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finny Bites, please send us an email at hi@askfinny.com.

AbbVie Inc. (ABBV) Stock Guide

Updated at: 12:33 am ET, 12 Jul 2020

Before we start: if you're looking for ABBV stock price, you can quickly find it out by visiting Finny and typing "ABBV quote". If you're looking for a quick scoop on ABBV stock (chart, price target, market cap, news and buy or sell analysis), go to Finny and look for "ABBV". You'll get all this info in one place. Or you can just type "ABBV news" to get the latest stock news.

Looking to buy or sell AbbVie Inc. (ABBV)? Interested in getting the full scoop on ABBV, including earnings and dividends, stock forecast, buy or sell analysis and key stats? If so, you came to the right place.

In this ABBV stock guide, we'll address key questions about ABBV, above and beyond what you can find on Yahoo Finance, Zacks, MarketWatch or Morningstar.

Here is what you'll be able to find in this guide:

Earnings and Dividends: earnings, earnings date, dividend rate and dividend yield;
Analyst Predictions: stock forecast and analyst ratings;
Analysis: Finny Score and buy or sell analysis;
Key Stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio, industry, sector, and number of employees.

And here is the list of questions we'll answer:
1. What are ABBV earnings?
2. When is ABBV earnings date?
3. What is ABBV dividend?
4. What is ABBV dividend yield?
5. What is ABBV stock forecast (i.e., prediction)?
6. ABBV buy or sell? What is ABBV Finny Score?
7. What are the reasons to buy ABBV? Why should I buy ABBV stock?
8. What are the reasons to sell ABBV? Why should I sell ABBV stock?
9. What are ABBV key stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

So let's start. Scroll down to the question that interests you the most.

Earnings and Dividends

1. What are ABBV earnings?

ABBV trailing 12-month earnings per share (EPS) is $5.65.

2. When is ABBV earnings date?

ABBV earnings date is July 31, 2020.

3. What is ABBV dividend?

ABBV forward dividend is $4.72.

4. What is ABBV dividend yield?

ABBV forward dividend yield is 5.31%.

Analyst Predictions

5. What is ABBV stock forecast (i.e., prediction)?

Based on ABBV analyst price targets, ABBV stock forecast is $93.69 (for a year from now). That means the average analyst price target for ABBV stock is $93.69. The prediction is based on 20 analyst estimates.

The low price target for ABBV is $70.00, while the high price target is $105.00.

ABBV analyst rating is Buy.

Analysis

6. ABBV buy or sell? What is ABBV Finny Score?

#{finnyScore:58}Our quantitative analysis shows 7 reasons to buy and 5 reasons to sell ABBV, resulting in Finny Score of 58.

7. What are the reasons to buy ABBV? Why should I buy ABBV stock?

Here are the reasons to buy ABBV stock:

  • AbbVie supports a strong dividend yield of close to 4%, which should act as valuation support, as the cash flows to support the dividend look fairly secure over the next few years.
  • AbbVie's increasing entrenchment in blood cancers should bode well for growth as pricing power remains strong in this therapeutic area of the healthcare market.
  • AbbVie's next generation immunology drugs targeting IL23 and JAK pathways should help mitigate the competitive headwinds facing Humira.
  • AbbVie’s flagship product, Humira, continues to drive revenues. Humira, an anti-inflammatory product, is the anti-tumor necrosis factor (TNF) drug of choice. Currently approved for 13 indications, Humira sales have increased consistently - 11.7% in 2015, 16.1% in 2016 and 14.6% in 2017 - backed by robust demand trends.
  • We are positive on AbbVie’s efforts to strengthen its pipeline. The company has been actively pursuing partnership deals and collaborations for candidates across several therapeutic areas including oncology, immunology, neuroscience, and infectious diseases. Some partners include Roche (Venclexta – oncology), J&J (Imbruvica – cancer), Biogen (Zinbryta – multiple sclerosis), Bristol-Myers (Empliciti – multiple myeloma), and Boehringer Ingelheim (risankizumab – psoriasis) among others.
  • AbbVie believes that oncology will be its major growth driver over the next 10 years. The acquisition of Pharmacyclics in May 2015 added Imbruvica to AbbVie’s portfolio and diversified the company’s revenue base. Imbruvica, currently approved for quite a few indications, has multi-billion dollar potential and AbbVie is exploring the potential to expand Imbruvica’s label into solid tumors and autoimmune diseases. Several studies on Imbruvica are ongoing to evaluate the drug alone or in combination in different patient segments.
  • AbbVie has a deep pipeline consisting of several interesting late-stage candidates. Promising candidates include elagolix (endometriosis – under priority review in the U.S.; phase III for uterine fibroids), risankizumab (phase III for psoriasis and Crohn’s disease and phase II psoriatic arthritis and ulcerative colitis), Depatux-M/ABT-414 (phase II trial for glioblastoma multiforme), ABBV-8E12 (phase II for early Alzheimer's disease and progressive supranuclear palsy (PSP)), and upadacitinib/ABT- 494 (six phase III studies for rheumatoid arthritis ongoing; phase III for Crohn’s disease and psoriatic arthritis, phase II for atopic dermatitis, giant cell arteritis and ulcerative colitis). The company expects to move 10 tumor candidates into clinical development in 2018.
  • We are also positive on the company’s progress with the development of interferon-free treatments for HCV. The approval of Viekira, AbbVie’s all-oral, interferon-free therapy with/without ribavirin (RBV), was a major positive for the company. Meanwhile, AbbVie’s 12-week, two-pill, once-daily combination HCV treatment, Viekirax, gained approval in Japan, the second largest HCV market in the world, in September 2015.
  • ABBV quarterly revenue growth was 10.10%, higher than the industry and sector average revenue growth (1.95% and 1.16%, respectively). See ABBV revenue growth chart.
  • ABBV forward dividend yield is 5.31%, higher than the industry (0.76%) and sector (0.16%) forward dividend yields. See ABBV forward dividend chart.
  • ABBV forward P/E ratio is 8.72, which is low compared to its industry peers’ P/E ratios. See ABBV forward P/E ratio chart.
  • ABBV PEG ratio (P/E adjusted for growth) is 1.79, which is low compared to its industry peers’ PEG ratios. See ABBV PEG chart.
  • ABBV average analyst rating is Buy. See ABBV analyst rating chart.
  • ABBV cash to debt ratio is 0.60, higher than the average industry (0.15) and sector (0.16) cash to debt ratio. See ABBV cash to debt chart.
  • ABBV Enterprise Value/EBITDA multiple is 9.45, which is low compared to its industry peers’ Enterprise Value/EBITDA ratios. See ABBV Enterprise Value/EBITDA chart.

8. What are the reasons to sell ABBV? Why should I sell ABBV stock?

Let's look at the reasons to sell ABBV stock (i.e., the bear case):

  • Several of AbbVie's pipeline products in immunology have mechanisms of action similar to drugs already approved, taking away the first mover advantage.
  • The high profit margins on Humira will cause an amplified impact on earnings as sales are lost to eventual biosimilar competition.
  • The pricing power of hepatitis C drugs has eroded significantly over the past few years, which may put further pressure on AbbVie hepatitis C platform.
  • Viekira’s performance was below the company’s expectations in 2016 and 2017. The company said that it experienced market share loss and price erosion due to competitive dynamics within the HCV market.
  • While we believe that AbbVie has an impressive pipeline, we note that clinical development involves a high degree of risk. Gaining approval for pipeline candidates has become more difficult given the tough regulatory environment. Development and regulatory setbacks for late-stage pipeline candidates would be a major disappointment for the company.
  • ABBV stock price ($96.83) is close to the 52-week high ($100.32). Perhaps now is a good time to sell? See ABBV price chart.
  • ABBV profitability is declining. The YoY profit margin change was -1.45 percentage points. See ABBV profitability chart.
  • ABBV average analyst price target ($93.69) is below its current price ($96.83). See ABBV price target chart.
  • ABBV short share of float is 5.78%. The stock is much more frequently shorted than the average industry, sector or S&P 500 stock. See ABBV short share of float chart.
  • ABBV short interest (days to cover the shorts) ratio is 8.31. The stock garners more short interest than the average industry, sector or S&P 500 stock. See ABBV short interest ratio chart.

Key Stats

9. What are ABBV key stats : revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

Let's look at the key statistics for ABBV:

Metrics ABBV
Price $92.22
Average Price Target / Upside $93.69 / 1.59%
Average Analyst Rating Buy
Forward Dividend Yield 5.10%
Industry Drug Manufacturers - Major
Sector Healthcare
Number of Employees 30,000
Market Cap $163.99B
Forward P/E Ratio 7.69
Price/Book Ratio 4.53
Revenue (TTM) $36.23B
YoY Quarterly Revenue Growth 26.30%
Profit Margin 19.20%

If you liked this analysis, check out Stock Guides for other stocks.

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finny Bites, please send us an email at hi@askfinny.com.

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