Indeed, AbbVie’s drug pipeline remains one of the strongest in this sector. Before Tuesday’s announcement, AGN stock had fallen around 32% over the past 12 months, while ABBV was down over 15%. The acquisition could provide a boost for AbbVie’s stock down the road as it is projected to increase why is abbvie stock dropping today the company’s cash flow as well as diversify its product portfolio. AbbVie is heavily reliant on revenue from Humira, which brought in $20 billion in revenue last year. But AbbVie has been looking to diversify its portfolio as cheaper alternatives are already becoming available in Europe.
Brian Orelli, PhD has no position in any of the stocks mentioned. Keith Speights owns shares of AbbVie and Pfizer. The Motley Fool has no position in any of the stocks mentioned.
Looking forward, Humira sales will be impacted by biosimilar competition, implying a meaningful decline in annual sales over the coming years. In fact, this has led investors concerns, reflecting in a decline in its P/S multiple over the recent years. IF ABBV stock moved by -5% over five trading days, THEN over the next twenty-one trading days ABBV stock moves an average of 3%, with a good 66% probability of a positive return over this period. Rova-T is also viewed by investors as a key drug that will reduce the company’s reliance on the megablockbuster drug Humira in the years ahead. Humira currently accounts for about two-thirds of AbbVie’s total sales so it’s critical for the company to develop other blockbuster drugs to better diversify its revenue stream.
AbbVie’s total revenue grew a solid 51% to $50.2 billion over the last twelve month period, compared to $33.0 billion in 2019. The surge in revenues can primarily be attributed to its Allergan AGN acquisition. However, on a per share basis, revenues grew only 26% to $28.30 over the last twelve month period, compared to $22.40 in 2019. This difference in total revenue and revenue per share can be attributed to a large 19% rise in total shares outstanding due to Allergan acquisition. Despite a 26% growth in RPS, AbbVie’s P/S multiple has declined to 4.2x currently, compared to 4.6x in 2019. Our dashboard, ‘What Factors Drove 33% Change In AbbVie Stock between 2018 and now?
Abbvie Q2 Immunology Revenue Up 17 8% To $721 Bln; Factset Consensus $686 Bln
Plus, AbbVie’s patent on the drug will expire in 2023 in the U.S. Adding Botox, the most popular cosmetic procedure in the U.S., to its portfolio is a good way for AbbVie to diversify. James Brumley has no position in any of the stocks mentioned.
- AbbVie ABBV stock fell over 15% through Tuesday morning trading.
- But whether it’s a good value right now, I don’t really know.
- The drug in question is called rovalpituzumab tesirine, which goes by the nickname Rova-T.
- Though the near-term market direction is cloudy, he is seeking opportunity.
- Wall Street estimated that the drug could bring in over $10 billion in sales a little past the middle of the decade.
AbbVie’s Rinvoq is one of these JAK-inhibiting prescription drugs. Earnings reports or recent company news can cause the stock price to drop. Read stock experts’ recommendationsfor help on deciding if you should buy, sell or hold the stock.
Abbvie Abbv Stock Falls After $63 Billion Allergan Acquisition Announcement
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Healthcare is his favourite defensive sector. AbbVie needs to provide clear guidance about the erosion curve in Humira, its top drug (that will go off-patent next year). A popular drug going generic isn’t necessarily a death sentence for the stock. Sales declined only slightly, despite a 40% drop in Humira. Today, they announced a $2.2 billion settlement in opiod litigation which removes that overhang.
Teva Pharmaceutical, Abbvie’s Allergan Settle Opioid Suit With San Francisco Update
There is likely to be a revision in peak sales estimates for Rinvoq, given that the new ruling will imply Rinvoq can be used as only second or third line of treatment. That said, the recent decline in ABBV stock appears to be overdone. Most of the physicians prescribe janus kinase inhibitors for arthritis only after they have tried a tumor necrosis factor inhibitor. Also, AbbVie is looking to expand the use of Rinvoq into other indications, including, atopic dermatitis, psoriatic arthritis, and ulcerative colitis.
It’s also better than the $3.14 per share that Wall Street was expecting. George Budwell has positions in AstraZeneca PLC. The Motley Fool has no position in any of the stocks mentioned. But whether it’s a good value right now, I don’t really know. There’s a lot of moving parts for AbbVie in its future that make it so hard to value in. It’s not a company that I keep an eye on its valuation all that much. I follow the company and its drugs, especially if they’re going to compete with other drugs of companies that I do own, but I don’t know how to value AbbVie that well.
While that’s a 4.1% increase from Q1 2021, it misses analysts’ revenue estimate of $13.61 billion for the period. You have already added five stocks to your watchlist. Upgrade to MarketBeat Daily Premium to add more stocks to your watchlist. The drugmaker’s Q2 results aren’t sitting well with shareholders today.
Another negative for ABBV stock comes from its outlook for the full year of 2022. The company cut its previous EPS guidance from $14 to $14.20 to a new outlook between $13.92 and $14.12. That’s not a good look for AbbVie with the midpoint below Wall Street’s estimate of $14.11 per share for the year.
Is Abbvie A Bad News Buy?
Allergan’s stock has struggled since an attempted merger with Pfizer PFE failed in 2016 in which Pfizer valued AGN at $363.63 per share, nearly double the amount AbbVie is set to pay. Are off by 7.8% in Wednesday afternoon’s trading session following a decision from the Food and Drug Administration to require a heart-risk warning on the label of its arthritis treatment Rinvoq. Stockchase, in its reporting on what has been discussed by individuals on business television programs , neither recommends nor promotes any investment strategies.
Biotechs have strong balance sheets, better than a few years ago. Better to buy individual biotech stocks over ETFs. His long-term concern comes out of Washington which is proposing drug-pricing laws. One mixed quarter doesn’t worry him; the stock has been a war horse. ABBV stock is down 7.5% as of Friday morning but is up 6.8% since the start of the year. However, things quickly turn grim for ABBV stock with its revenue of $13.54 billion.
Blood cancer drug Venclexta had a reported $473 million in revenue, up 16.9% year over year. AbbVie ABBV stock fell over 15% through Tuesday morning trading. The significant drop came after the company announced that it will acquire Allergan PLC AGN in a deal worth approximately $63 billion. The drop brought AbbVie stock to a new 52-week low of $66.56 per share. Meanwhile, Allergan stock jumped about 27% after the news.
The company is alleging that AbbVie’s patent is invalid since the dosage regimen it covers was a “routine optimization of the therapy” that was known by researchers,Bloombergadds. A decision in the case is expected later this year. Receive full access to our market insights, commentary, newsletters, breaking news alerts, and more. Any recent changes to analyst estimates for AbbVie should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends.
I haven’t really looked at the valuation of AbbVie that much. I felt this was coming, so I was a little surprised at the 10% drop, but apparently, generally investors weren’t really expecting it. ABBV stock fares better after Case 1, with an average return of 3% over the next month under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an average return of 1% for Case 2.
The Drugmaker’s Q2 Results Aren’t Sitting Well With Shareholders Today
On a similar note, the biopharma’s blood cancer franchise saw its global revenue sink by an eye-popping 9.1% in the second quarter, relative to the same period a year ago. AbbVie’s normally strong cancer unit contracted in the most recent quarter mainly due to a 17.1% drop in https://xcritical.com/ net revenue for the all-star blood disorder medication Imbruvica. The drug appears to be losing market share to newer competitors such as AstraZeneca’s Calquence. Much of this growth in ABBV stock over the recent years can be attributed to favorable changes in its revenues.